This morning I received the second quarter report for SIVB, which stated, "As of June 30, 2002, the Company had repurchased 272,500 shares of common stock totaling $8.3 million in conjunction with the $50.0 million share repurchase program authorized by the Board of Directors on March 31, 2002. The Company intends to continue to repurchase shares under the program from time to time, under conditions which allow such repurchases to be accretive to earnings while maintaining capital ratios that exceed the guidelines for a well capitalized financial institution."
I calculate the average cost of the shares repurchased in the second quarter of 2002 to have been $30.458 per share. There was still, as of June 30, 2002, $41.7 million left with which to repurchase shares.
On a close Friday of $20.70, and some sub-$20 opportunities last week, there were times that the average cost per share repurchased could have been reduced and the accretive value to earnings enhanced. Hopefully someone was awake and buyng.
From the conference call it is clear that they have excess capital which should be used for either acquisitions or stock buybacks. The Jefferies analyst has been very hard on their Alliant acquisition so there is probably not much support from analysts for another acquisition until they can prove that they can make good ones. Maybe Alliant is a great acqisition but they have not proved that yet. The only thing that makes sense at these levels is a massive buyback. Finish the current $50,000,000 and move on to another. If the board does not think that it is a great buy at these prices, no one else will either.