Looking back on regional banks stocks’ Q4 earnings, we examine this quarter’s best and worst performers, including The Bancorp (NASDAQ:TBBK) 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 94 regional banks stocks we track reported a satisfactory Q4. As a group, revenues beat analysts’ consensus estimates by 1.5%.
In light of this news, share prices of the companies have held steady as they are up 4.8% on average since the latest earnings results.
Weakest Q4: 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 $172.7 million, up 8.2% year on year. This print fell short of analysts’ expectations by 11%. Overall, it was a disappointing quarter for the company with a significant miss of analysts’ tangible book value per share estimates and a significant miss of analysts’ revenue estimates.
“We are pleased with the significant progress made this year in strengthening our platform and deepening and expanding new and existing relationships. While we ended the year with record fourth quarter EPS and ROE, we did fall short of our expectations and guidance due to a culmination of factors, including the prolonged government shutdown’s impact on transaction volume and deposit flows, the strong ramp-up in sponsored credit materializing later than expected, some unanticipated NIM compression, and an unexpected legal settlement cost,” said Damian Kozlowski, CEO and President of The Bancorp.
Unsurprisingly, the stock is down 18.7% since reporting and currently trades at $57.33.
Is now the time to buy The Bancorp? Access our full analysis of the earnings results here, it’s free.
Best Q4: Merchants Bancorp (NASDAQ:MBIN)
With a strategic focus on low-risk, government-backed lending programs, Merchants Bancorp (NASDAQCM:MBIN) is an Indiana-based bank holding company specializing in multi-family mortgage banking, mortgage warehousing, and traditional banking services.
Merchants Bancorp reported revenues of $185.3 million, down 4.4% year on year, outperforming analysts’ expectations by 7.8%. The business had a stunning quarter with a beat of analysts’ EPS estimates and a solid beat of analysts’ net interest income estimates.
The market seems happy with the results as the stock is up 34.2% since reporting. It currently trades at $46.92.
Is now the time to buy Merchants Bancorp? Access our full analysis of the earnings results here, it’s free.
National Bank Holdings (NYSE:NBHC)
Operating under familiar local brands like Community Banks of Colorado, Bank Midwest, and Bank of Jackson Hole, National Bank Holdings (NYSE:NBHC) operates regional banks across Colorado, Kansas, Missouri, Wyoming, Texas, and other western states, offering commercial, business, and consumer banking services.
National Bank Holdings reported revenues of $102.6 million, down 3.7% year on year, falling short of analysts’ expectations by 2.7%. 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.
Interestingly, the stock is up 3.6% since the results and currently trades at $41.52.
Read our full analysis of National Bank Holdings’s results here.
M&T Bank (NYSE:MTB)
Tracing its roots back to 1856 when it was founded as Manufacturers and Traders Bank in Buffalo, New York, M&T Bank (NYSE:MTB) is a regional bank holding company that provides retail and commercial banking, trust, wealth management, and investment services to consumers and businesses.
M&T Bank reported revenues of $2.49 billion, up 4.5% year on year. This result met analysts’ expectations. Taking a step back, it was a mixed quarter as it also produced a narrow beat of analysts’ tangible book value per share estimates but a slight miss of analysts’ net interest income estimates.
The stock is up 10.7% since reporting and currently trades at $235.32.
Read our full, actionable report on M&T Bank here, it’s free.
Byline Bancorp (NYSE:BY)
Ranking as the fifth most active Small Business Administration lender in the country, Byline Bancorp (NYSE:BY) is a Chicago-based bank that provides banking services to small and medium-sized businesses, commercial real estate developers, and consumers.
Byline Bancorp reported revenues of $117 million, up 11.8% year on year. This number surpassed analysts’ expectations by 4.6%. It was a very strong quarter as it also produced an impressive beat of analysts’ revenue estimates and a solid beat of analysts’ net interest income estimates.
The stock is up 3.1% since reporting and currently trades at $32.69.
Read our full, actionable report on Byline Bancorp here, it’s free.
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