Insights
Why own boring banks? A holiday gift of moneyball math.
First, I will not get to speak to most of the folks reading this, but if you celebrate Christmas I wish you an enjoyable holiday, hopefully surrounded by friends, family or both… Most of us know how compounding works. The rub is how difficult it is to apply. Out of...
Lessons From the 400% Move in Customers Bancorp (CUBI) Shares
From time to time I will write about client positions, not as investment advice but to share some of the lessons we learn from inside the sector. Your comments or outreach are welcome via our contact page. As flexes go, the above paragraph above, hidden at the bottom...
Using Strong Markets to Run Numbers and Fade “Inertia Banks”
As banks rally at the same time many of them are making low ROI loans, we're spending a minute this afternoon making sure folks know what they are getting when they buy the sector. Is banking a good business? A good business returns more than its cost of capital...
The Pacific Enterprise Sale: An eye-opening perspective on bank mergers
Last week Pacific Enterprise (PEBN) announced it was selling to Bay Commercial (BCML). Pacific Enterprise is a $650 million, 1-branch bank in Irvine, CA with 1/3 of loans in PPP, typically earning 7% ROE at 65% efficiency. Normally PEBN holders would read the merger...
How Will Central Bank Digital Currencies Work, Will They Disrupt the Banking System, and Who Wins or Loses?
We have gotten a number of questions about what digital currencies mean, so below is a brief primer on their current status and potential impact. While this topic may seem wonky today, we will all at some point in the next few years likely have the option of a digital...
A Key Factor Separating Bank Compounders vs. Laggards…
Owning a basket of the most efficient banks is a consistently outperforming strategyUpcoming forced selling brings a few opportunities. Sort for efficiency among the forced selling We are currently entering an unusual season, when up to 80 banks are added, but mostly...
Banks are not as cheap as they were, but several strategies still make sense
4 strategies to find performance in an otherwise lofty market
Time to move to the “Coastal”? Coastal Financial (CCB) is different.
Coastal Financial is a bank that has found a way to get pricing power.
Does a community bank want to sell? Use this proxy season to learn the secrets.
Learning the secrets to bank mergers from proxy reports.
Nice rally banks got there…shame if something were to happen to it.
Does the bank rally stall? Reading Warren Buffet's letter this past weekend, bank investors might wonder why Berkshire's investment heads dumped so many banks near the bottom. After all, banks are not far behind airlines and wildcatters in line to benefit from...