) -- Coincidentally or not, the May 6 "flash crash" is shaping up as a good marker for when the current bearish mood took hold of the market.

European woes have been a big factor in the sell-off, but a hardening of legislators' determination to take the banks to task for their role in wrecking the U.S. economy has also been a major influence, and bank stocks in general were weak again on Friday as Congress hammered away at reconciling separate House and Senate financial reform bills.

>>>The Beginning of the End for Wall Street

As a result, all 50 of the largest U.S. banks, not just giant ones with international exposure like


(C) - Get Citigroup Inc. Report


Bank of America

(BAC) - Get Bank of America Corp Report

were down from May 5 through Tuesday of this week. The


(KBE) - Get SPDR S&P Bank ETF Report

is down more than 12% in that stretch.


decided to look at the five banks that held up the best during that period, to see whether investors who expect a rebound but remain bearish should look to them as safe havens.

If the weakness continues, these stocks will likely decline further, but their losses may be less severe. If the market turns, these stocks are likely to gain, though not by as much as some of the riskier names.


People's United Financial

(PBCT) - Get People's United Financial, Inc. Report

Shares of Bridgeport, Conn.-based People's United lost 5.7% from the May 5 close through Tuesday, making it the fifth best performer among the top 50 bank stocks during that time period.

"In uncertain times, PBCT is considered a safe-haven," wrote Mark Fitzgibbon, director of research at Sandler O'Neill, in a May 10 note in which he raised the stock to a "buy". Citing its tangible common equity to asset ratio of 18.6%, he continued: "we can't think of many institutions that are better positioned to ride out a storm."

People's United's shares began falling in April, and the decline accelerated after the board "fired" the CEO, as Fitzgibbon put it in an interview with



People's United stated in a press release the CEO, Philip Sherringham, "resigned by mutual agreement with the Board of Directors from the Company and the Board."

Fitzgibbon argues the stock dropped because investors were frustrated over the company's inability to capitalize on its strength to acquire weaker institutions.

In May, however, the stock held its own during the broader selloff. Fitzgibbon attributes that resilience not only to People's safe haven status, but to investor optimism. People's "will find a new and better CEO very soon," he said. In his May 10 note, Fitzgibbon described the open People's CEO post as a "dream job."


First Niagara Financial Group


Buffalo, N.Y.-based First Niagara fell 4.9% from the May 5 close through Tuesday.

"It's consistently been viewed as more of a defensive stock because of the solid credit quality in the markets that it's in," says Damon DelMonte, analyst with Keefe, Bruyette & Woods, who rates the stock "outperform."

However, two acquisitions the bank has made in the past year have roughly doubled the size of First Niagara's balance sheet, putting it in a position "to generate strong earnings momentum," DelMonte says.

First Niagara bought Philadelphia-area bank

Harleysville National Corp.

for $237 million in July of last year, and it bought 57 branches from failed Ohio bank National City, as part of National City's sale to

PNC Financial Services Group

(PNC) - Get PNC Financial Services Group, Inc. Report

in April 2009.

Year-to-date, First Niagara shares are down about 7%, and sentiment on Wall Street is guardedly optimistic these days with six of the 10 analysts covering the stock at buy or strong buy, and the remaining 4 stuck on hold.

TheStreet Recommends


First Citizens BancShares

(FCNCA) - Get First Citizens BancShares, Inc. Class A Report

Raleigh, N.C.-based First Citizens fell just 3.6% from the May 5 close through Tuesday.

Brett Scheiner, analyst with FBR Capital Markets, calls First Citizens "one of the healthiest banks in the country."

"They have centralized underwriting and even as they grew from three or four states into 17 states, they never relinquished that central underwriting feature and they're very well capitalized. The bank is 66% controlled by the founding family, whose last name is Holding and because of that they're run very conservatively from the lending side," Scheiner says.

Scheiner says First Citizens has acquired more banks through FDIC-assisted transactions than any other bank in the U.S. -- four this cycle and six from 1991-93, the previous period in which many U.S. banks failed.

"That stock is very inexpensive," Scheiner says. "The bank is not making a tremendous amount of money right now because of the expense of running a branch footprint through 17 states."

Scheiner says there is "really not much downside" in the stock, though "if the banks ripped ripped very hard, the more stressed names would outperform--the higher beta names. This is a much more conservative, less volatile company and therefore the stock reflects that. I still see tremendous value there; it's one of my favorite banks in the United States."

He says a bigger catalyst for a move higher by First Citizens' shares would be if it announced another acquisition, rather than a jump in the overall market.


New York Community Bancorp

( NYB)

Dropping just 1.3% from May 5 through Tuesday, Westbury, N.Y.-based New York Community Bancorp was the second best bank stock performer from the May 5 close through Tuesday.

In a recent profile of

New York Community Bancorp

, my colleague Laurie Kulikowski emphasized the bank's hands-on approach to lending, in which board members often accompany management to check up on properties funded through its loans.

Sandler's Fitzgibbon says New York Community "has been a prolific buyer of failed institutions," noting the bank has done two acquisitions in recent months.

According to

The Wall Street Journal

, it was one of the first banks to allow the FDIC to benefit from the pop several acquiring banks' shares have gotten following deals with the regulator to buy failed institutions.

That crafty move surely helped the bank move to the top of the list of suitors in highly competitive bids for FDIC-assisted acquisitions. Fitzgibbon also notes New York Commuinity's safe-haven status and high dividend yield.

The view in the analyst community is mixed: Eight of the 17 analysts covering the bank have hold ratings, and one is at underperform. The stock's outpeformance so far this year may have something to do with that, as it was up nearly 11% through Thursday's finish.


Hudson City Bancorp


Shares of

Hudson City Bancorp

were down just 1% since the "flash crash" through Tuesday's close. Year-to-date, the stock has declined a little less than 5%.

Like People's United Financial, Hudson City is a former mutual holding company, and I highlighted the unusual

mutual holding company

ownership structure in an article for


last year.

"They had good earnings in the first quarter," says Sandler analyst Fitzgibbon "They are perceived as being a safe haven in this difficult environment. They haven't had major credit issues. They have excess capital and if anything they're capitalizing on this dislocation in the marketplace to grow and expand."

The stock may be down in 2010, there's always the considerable dividend yield (4.8% on a forward annual basis through Thursday's close) to consider, as




in the past.

But Wall Street seems to have some skepticism, as 11 of the 16 analysts covering Hudson City are at either hold (8) or underperform (3). The median 12-month price target on the stock of $15, however, somewhat belies that trepidation as it implies potential appreciation of 15% for the stock from current prices.


Written by Dan Freed in New York.