You are talking about two very differently structured portfolios. WAMU was a big player in the sub-prime offering, something TONE NEVER got involved with. In reserving for NPLs, etc. you must take into account the QUALITY of the asset. If the quality of the asset would return 75% at a sellable price, then you reserve for 25% of the original loan, etc.
I can't say myself with accuracy what the actual detailed quality of the loans that are in TONE's NPL list are, but it may not be as much a case of underreserving as you believe IMHO.
nobody wants to discuss crab you pushing...so what is your position in TONE? Short or just waisting time out of goodness of charity to help us see the light??? You honestly trying to compare TONE to WAMU????
How can you say they have reserved for considerably more losses? They are less reserved than Wamu was when they were seized. They are way less reserved than almost any other area banks of any size. And they have a three or fourfold proportion of bad loans. They haven't charged off nearly as much as others in similar situations. You want examples? Fhn, fnbo, USB, amcore, hell even colonial had higher reserves. You are drinking managements Kool-aid. The only thing they have proven adept at reserving, in my opinion, is their jobs. Good luck. I can see nobody here wants to discuss facts.
Excellent dialogue guys. I appreciate the thoughtful comments and the improved tenor of the exchange. This is serious stuff. I know I come across as negative, but a better characterization would be disappointed.
In my eyes accountability is still missing. We've all had performance reviews. Many of us hard-working, ethical types probably tossed and turned at even the hint of underperformance. In this day and age, to have your hand slapped for improper conduct by your supervisory agency, to generate incomes on the management team on par with much larger banks. To award stock grants to board members that are in some cases higher than board member compensation in the top 20 U.S. banks while seeing your bank lose 85% of it's market value, not diminish management salaries accordingly, not have layoffs, not realign business units in an aggressive fashion, etc., etc. This loose leadership strategy shouldn't be present in this day and age.
We're only as good as our information. A fellow investor pal of mine was at the Annual shareholder's meeting. A question was posed about what the company was willing to do to return to profitability if the market continues to go downward. The answer, "reduce the size of things". Thus my "no plan" comment.
TierOne Corporation, the holding company, at one point had $20+ million in holdings as a safety net...where does that stand now. Did it go away and need to be replenished with this deal? I'm just asking. Some of these decisions fly under the radar.
If TierOne is going to return to a better state of operation, in this footprint, they will need to participate in Omaha, in Council Bluffs, in Columbus, etc. They just jettisoned those locations in a deal that has me scratching my head. The bankable growth opportunity in Omaha is nearly 8x that of Lincoln.
I want to be positive. I want to understand the blueprint. Unfortunately I was hoping the plans reflected the creation of a 3 bedroom home, not a drafty dog house.
Hoping for the best and watching all the moves from this point very, very carefully.
Todd: I respectfully question your assertion that the bankable growth opportunity in Omaha is 8x that of Lincoln. To be sure, the population of the greater Omaha area is almost 3 times the size of the population of Lincoln and Lancaster County, and Omaha's economy clearly has more $$$ running through it and is more vibrant than Lincoln's. But, Tierone has not really ever been a major player at all in Omaha, where the dominant players are First National Nebraska, Wells Fargo, US Bank, Bank of the West, American National, Security National, et. al. TierOne has been competitive, but has not ever been a major player in Omaha like it is in Lincoln. So, while I am not pleased to see the Omaha branches go, I do not view this as a tremendous negative like you apparently do, and understand the reasoning behind this positive transaction and development.
Thanks for the good comments Todd. I think we all would like to see the same things happen, and the differences in opinion and civil exchange of ideas are fruitful, as opposed to some of the ranting and bashing on this board. I do not have any set agenda, other than my firm believe, having watched this company closely for years, including through the IPO and failed buyout deal with CapitalSource, that there is value here above the current depressed stock price. I understand that the market obviously questions the current stated book value of $13.50, but believe that the value has to be closer to that than the current price of $3.30. Time will tell, and I could get burned, but I think there is positive upside for patient investors here.
although I agree with this management being muted about everyting we do have to keep one minor detail in mind....we are in a worst recession since the great depression. Its not the managements fault for the stock to be here at these levels but I think they are doing what is possible to sure up first what we do have and in a couple of years start a growth plan to get company back up the ladder. Just being financially strong in the current market will award us a BV SP soon enough. Give it time. The street has voted on this deal with its wallet so far.
You ask: "TierOne Corporation, the holding company, at one point had $20+ million in holdings as a safety net...where does that stand now. Did it go away and need to be replenished with this deal? I'm just asking. Some of these decisions fly under the radar."
It's gone. Had you bothered to read any of the filings you would have known that.
That is pure nonsense. On what facts do you base this absurd prediction? This stock has every chance to recover, based on the fundamentals, and the company is clearly not in danger of going under. If, as you have previously stated, you have no financial interest here, then why do you hang around here bashing the company and stock? You have to either be shorting the stock, be a paid basher, or have some other beef with the company, e.g. disgruntled former employee maybe?