Eh. A mixed bag from my perspective. I was hoping to see two things in the report: steady progress on efficiency ratio, and solid loan growth. They only hit one out of two.
I was especially disappointed with mortgage loan growth, seeing how several other banks showed a big uptick in mortgage applications and pipeline this spring. PBCT had decent numbers, but they need to do better if they're going to find a place to put those Citizens deposits. Dumping it all in to low-yield securities isn't going to cut it.
At least the payout ratio continued to decline. A relatively safe 5.3% will probably keep me in, at least for a while.
Unbelievable. The stock price was already discounted to anticipate weak earnings, met or exceeded the analyst projections, and the price gets hammered. As an aside, the efficiency ratio improved. And most banks are not portfolioing residential mortgages, but selling them on the secondary market because the rates are so low. I know the yield is better than overnight deposits, but if you hold them because of the short term yield advantage, you get killed 3- 4 years down the line when rates increase to where they really should be if the fed was not flooding the market with liquidity. If you try to sell them at that point you take a big hit on the discount. These folks are in the northeast which does not have a robust growth economy so I respectfully disagree with the comment that thier growth is below expectations. Personally when I look at the missteps of the nationals with one outrageous revelation after another, am pleased to see these folks sticking to their comfort zone and making careful steady progress. You are not going to see them do anything real dramatic. Not their culture, but all in all I said it before and say it again, a great dividend with growth.
Very respectable results. ROA is over 1% and they are now earning more than they pay out in dividends (85%) so the naysayers that babbled about the need to cut the dividend were wrong. Stock has a book value of $15 a share and it pays a dividend in excess of 5% based on the current stock price. I am okay with a slow growth predictible stock that appears to be executing its business plan as opposed to the mega banks which have been looking for quick ways to pump earnings resulting in very ugly headlines as their missteps come to light!