OTS is history, soon to be merged into OCC and the old OTS lolly-pop-review days will be over. PBCT is in for quite a shock from the level of perfection demanded by the OCC. The capital ratios look great right now but you aren't comparing apples to apples, how is it that peoples portfolios are doing better than everyone else's? Are they really smarter, or have they benefited from candy-ass reviews by OTS, which itself has earned such a bad reputation that even the other fed agencies want them gone. Not sure this stock is going to be such a high flier, folks.
No idea what the new regulators will do but I do know that management is very risk adverse. They never got into the fringe lending or derivatives. They pontificate continuously before approving credits. Doubt that there will be any big portfolio revelations resulting from regulatory reviews. May have an issue with a dividend payout in excess of earnings eventually but I believe there is a permisable period they can do that, Given the extent of capital is not going to create an adequacy issue for quite a while. The 100,000 lb elephant in the room is whether or not management deploys the excess capital in a thoughtful manner which is accretive before the cows come home.
Peoples doesn't have any regulatory issues because they don't do any business. They sit on a 2.5 billion dollar "war chest" that was raised in a public offering before the big meltdown. The money earns virtually nothing. Apparently they are on the prowl for a "strategic aquisition" but so far haven't found one. The banking crisis has left many worthy companies unable to find capital simply because none is available. But Peoples doesn't choose to put the money to work there either. Peoples "conservative" lending policies keeps them from taking any risk at all. Sitting on money and not taking any risk benefits management. They continue to draw hefty salaries...paying themselves and the dividend with shareholder money while doing nothing!!!!! Its great work if you can get it.
Serp- Your analysis is right on. This Board and Management reward themselves like they did something. In fact, they have ingrained a "Reactive" or "Crisis Managment" managmement style that does not bode well for the future.
The lack of proactive management, has resulted in inferior technology and services. For God's sake, they just rolled out Remote Deposit Capture!!! By hiring the CFO when Klein died only reinforced the Board's preference to avoid reality.
I also think the OCC will have a field day with this crew. I wonder how the examiners feel about a dividend payout that exceeds earnings. My experience tells me this practice will soon end.