Magazine article American Banker

Ryan Beck Gives Ratings on 3 Memphis Banks

Magazine article American Banker

Ryan Beck Gives Ratings on 3 Memphis Banks

Article excerpt

Ryan, Beck & Co. Inc., continuing to expand its research coverage, added three Memphis banking companies to its roster Tuesday.

Jacqueline Reeves, a regional bank analyst for the Livingston, N.J., brokerage, initiated coverage of First Tennessee National Corp. with "outperform," National Commerce Financial Corp. with "market perform," and Union Planters Corp. with "underperform" ratings.

The three companies are Tennessee's largest in assets and among the deposit leaders. Union Planters has the most assets, with $32 billion. First Tennessee is next, with $25.5 billion, and National Commerce is third, with $22.9 billion.

In deposits, First Tennessee is No. 1, with 15.7% of the Tennessee market, Ms. Reeves said. Union Planters ranks fourth, with 8%, and National Commerce sixth, with 5.4%.

Many analysts consider the Southeast attractive for investors because of its strong economic growth. Tennessee, though its economy is hardly the most robust in the region, "has been able to hold its own," Ms. Reeves wrote. She cited its central position in the region and in air cargo and river shipping traffic. The state also is home to growing health-care companies.

First Tennessee's "profitability is pretty spectacular," Ms. Reeves said, with a return on equity of 26.2%. It has a diverse earnings mix, reinforced during the mortgage boom. Instead of converting all of its strong refinancing revenue into profit, the company invested some -- notably in its capital markets business. "Those investments will bear fruit" after the mortgage boom, Ms. …

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