As the Q3 earnings season comes to a close, it’s time to take stock of this quarter’s best and worst performers in the regional banks industry, including First Interstate BancSystem (NASDAQ:FIBK) and its peers.
Regional banks, financial institutions operating within specific geographic areas, serve as intermediaries between local depositors and borrowers. They benefit from rising interest rates that improve net interest margins (the difference between loan yields and deposit costs), digital transformation reducing operational expenses, and local economic growth driving loan demand. However, these banks face headwinds from fintech competition, deposit outflows to higher-yielding alternatives, credit deterioration (increasing loan defaults) during economic slowdowns, and regulatory compliance costs. Recent concerns about regional bank stability following high-profile failures and significant commercial real estate exposure present additional challenges.
The 101 regional banks stocks we track reported a satisfactory Q3. As a group, revenues beat analysts’ consensus estimates by 1.3%.
Thankfully, share prices of the companies have been resilient as they are up 9.7% on average since the latest earnings results.
First Interstate BancSystem (NASDAQ:FIBK)
Tracing its roots back to 1971 and still guided by founding family principles, First Interstate BancSystem (NASDAQ:FIBK) operates a network of community banks across 14 western and midwestern states, offering comprehensive banking services to individuals, businesses, and government entities.
First Interstate BancSystem reported revenues of $251.9 million, flat year on year. This print fell short of analysts’ expectations by 1%. Overall, it was a mixed quarter for the company with a beat of analysts’ EPS estimates but a miss of analysts’ net interest income estimates.
“We continue to execute on our strategic plan, announced earlier this year, to focus on organic growth and leverage our strong balance sheet to support our customers. Our net interest margin continued to improve, and we maintained a clear focus on managing expenses prudently, with a goal to drive long-term, profitable growth,” said James A Reuter, President and Chief Executive Officer of the Company.
Interestingly, the stock is up 15.9% since reporting and currently trades at $37.21.
Read our full report on First Interstate BancSystem here, it’s free.
Best Q3: Customers Bancorp (NYSE:CUBI)
Originally founded with a "high-tech, high-touch" branch-light banking strategy, Customers Bancorp (NYSE:CUBI) is a bank holding company that provides commercial and consumer banking services through its Customers Bank subsidiary, with a focus on business lending and digital banking.
Customers Bancorp reported revenues of $231.8 million, up 38.3% year on year, outperforming analysts’ expectations by 6.9%. The business had a stunning quarter with a solid beat of analysts’ net interest income estimates and an impressive beat of analysts’ revenue estimates.
The market seems happy with the results as the stock is up 19.5% since reporting. It currently trades at $78.37.
Is now the time to buy Customers Bancorp? Access our full analysis of the earnings results here, it’s free.
Weakest Q3: The Bancorp (NASDAQ:TBBK)
Operating behind the scenes of many popular fintech apps and prepaid cards you might use daily, The Bancorp (NASDAQ:TBBK) is a bank holding company that specializes in providing banking services to fintech companies and offering specialty lending products.
The Bancorp reported revenues of $174.7 million, up 38.8% year on year, falling short of analysts’ expectations by 9.9%. It was a disappointing quarter as it posted a significant miss of analysts’ revenue estimates and a significant miss of analysts’ net interest income estimates.
The Bancorp delivered the weakest performance against analyst estimates in the group. As expected, the stock is down 9.6% since the results and currently trades at $69.81.
Read our full analysis of The Bancorp’s results here.
TriCo Bancshares (NASDAQ:TCBK)
Founded in 1975 and headquartered in Chico, California, TriCo Bancshares (NASDAQ:TCBK) operates Tri Counties Bank, providing personal, small business, and commercial banking services through branches across California.
TriCo Bancshares reported revenues of $107.4 million, up 8.5% year on year. This print topped analysts’ expectations by 1%. Overall, it was a strong quarter as it also logged a beat of analysts’ EPS estimates and a decent beat of analysts’ tangible book value per share estimates.
The stock is up 13.3% since reporting and currently trades at $48.23.
Read our full, actionable report on TriCo Bancshares here, it’s free.
Cadence Bank (NYSE:CADE)
With roots dating back to 1885 and a strategic focus on middle-market commercial lending, Cadence Bancorporation (NYSE:CADE) is a bank holding company that provides commercial banking, retail banking, and wealth management services to middle-market businesses and individuals.
Cadence Bank reported revenues of $519.3 million, up 15.1% year on year. This number came in 0.7% below analysts' expectations. Zooming out, it was a mixed quarter as it also recorded a solid beat of analysts’ tangible book value per share estimates but a slight miss of analysts’ revenue estimates.
The stock is up 21.9% since reporting and currently trades at $45.19.
Read our full, actionable report on Cadence Bank here, it’s free.
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