3. Signature Bank
Shares of Signature Bank ( SBNY) of New York closed at $70.34 Wednesday, returning 17% year-to-date, following a 20% return during 2011. The five-year total return for the stock was 104%. The shares trade for 2.1 times their reported Sept. 30 book value of $33.80, and for 16 times the consensus 2013 EPS estimate of $4.29. The consensus 2014 EPS estimate is $4.69. Signature Bank had total assets of $16.5 billion as of Sept. 30. The bank reported third-quarter earnings of $47.7 million, or a dollar a share, increasing from $45.3 million, or 96 cents a share, in the second quarter, and $38.4 million, or 83 cents a share, in the third quarter of 2011. Total loans grew by 9% just in the third quarter, to $8.8 billion as of Sept. 30, growing by 28% from a year earlier. Net interest income was up 6% sequentially and 20% year-over-year, to $141.7 million in the third quarter, and the company even bucked the industry trend, with its third-quarter net interest margin -- the difference between the average yield on loans and investments and the average cost for deposits and borrowings -- widening to 3.56%, from 3.54% the previous quarter, and 3.51% a year earlier, however, the bank said that if loan prepayment income was excluded, the margin "decreased 3 Basis Points to 3.41 Percent, compared with 3.44 Percent for the 2012 second quarter." Following the bank's earnings announcement, KBW analyst Christopher McGratty wrote that "in the world of modest economic growth, Signature continues to defy the banking odds, producing 36%
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