Magazine article American Banker

Calif. Market Conditions Seen Staying Favorable

Magazine article American Banker

Calif. Market Conditions Seen Staying Favorable

Article excerpt

Calif. Market Conditions Seen Staying Favorable (Corrected)

California bank stocks have been steadily rising this year, because of improving economic conditions, an ongoing residential housing and commercial real estate boom, and an expected pickup in commercial loan demand.

The trends are still in place and look to favor shares of a range of large and small banks with operations in California, according to a report Tuesday by Friedman, Billings, Ramsey & Co. Inc.

The report said several banks are poised to benefit, including City National Corp., whose shares have risen 13.7% so far this year (as of mid-afternoon Wednesday); UnionBanCal Corp., up 13.7%; UCBH Holdings Inc., up 21%; PFF Bancorp Inc., up 26.6%; Commercial Capital Bancorp Inc., up 45.3%; and Placer Sierra Bancshares, up 45% since it went public in August.

Friedman Billings even cited Comerica Inc., which has a substantial lending practice in California. The Detroit company's shares have risen 11% this year through mid-afternoon Wednesday.

Shares of East West Bancorp Inc. have risen 57.2% this year, and Friedman Billings also named the San Marino, Calif., company as one of its top picks.

James Abbott, an analyst with Friedman Billings, said banks' interest in increasing their share in California mirrors the current Florida land rush. "The demographics are similar."

The Friedman Billings report, as well as one last week from Royal Bank of Canada's RBC Capital Markets, cite California's continuing residential housing boom as a main driver of bank stock performance. …

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