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BNC Bancorp (BNCN) Message Board

sambordulac 13 posts  |  Last Activity: Jul 9, 2014 10:40 AM Member since: May 25, 2000
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  • Reply to

    Is this a Good Value?

    by workallday997 Jun 2, 2014 9:04 PM
    sambordulac sambordulac Jul 9, 2014 10:40 AM Flag

    Hi, Functor,

    Maybe my exit price for FOFN was $1.8. I remember it was like 10% less than yours.

    Near Birmingham, SZBI perked up.

    SZBI got the blessing from regulators to book some tax asset (2013 annual report) and to buy back some TARP but it missed the dead line with the Treasury to bid on its TARP directly. Either way, portion of the TARP will be bought back in the near future along with the TARP dividends that was not paid due to regulators' earlier concern about its capital.

    While this speaks well for its achievement, its mortgage banking and lending both softened. As long as it earns a positive return, additional tax asset may be put back on the book. There was $0.8M left as of 4Q13.

    Inland Alabama is not growing. To grow is to take business from others, not an easy task, nor fruitful at times.
    SZBI may not make much money this year but it has a solid CEO in Randall Fields.

    I doubled my holdings between $2.6 to $3.0 per share. Tangible book value including tax asset is around $8.5 per share.

    Unlike FOFN, no dilutions for SZBI. Diluted share count was 0.72 million.

    Sam

  • Reply to

    Is this a Good Value?

    by workallday997 Jun 2, 2014 9:04 PM
    sambordulac sambordulac Jun 29, 2014 11:13 AM Flag

    Hello, Truong,

    I am not around as I used to. Sorry to be so late to rite back.

    I sold FOFN a couple of months ago at $2. The recap at $1 took the book value below $1.5.

    Yes, it's nice that shareholders could participate in the recap but the upside is now limited to $1.5.
    (Still good for share holders who had the money, but most would flip it as they did last week.)

    The CEO who got it in trouble is still there. Sad.

    Sam

  • Reply to

    Is this a Good Value?

    by workallday997 Jun 2, 2014 9:04 PM
    sambordulac sambordulac Jun 8, 2014 5:35 PM Flag

    Greetings, Mr. Work,

    USBI has the capital. T-1 was 10.99%. It also has a good CEO in James House.
    Loan yield had been off the chart before the recession. Once it sorts out the various problems, I think it can return to high return mode and likely paying very good dividends.
    So, yes, it's still very cheap on the basis of tangible book. It will still be a good value even when trading at the $11+ book value.

    Several hurdles remain.
    Credit is stubbornly high, but seems well reserved.
    It experienced soft loan demand in 1Q14 and loan yield dropped sharply. But I think this may be temporary.

    I don't know when it will turn around, but I am convinced it will. USBI is one of my top five position.

    Best,

    Sam
    .

  • Reply to

    CLBH earning hit a snag in 1Q14

    by sambordulac May 14, 2014 2:09 PM
    sambordulac sambordulac May 21, 2014 11:11 PM Flag

    Hi, Mr. BM,

    You are welcome.

    CLBH may need to scale back it's mortgage business to match the lower volume and profitability. It should complete the down sizing by 2Q14. I'll talk about it here if I have further thoughts.

    So that you know, I am out of both stocks. And I am not interested in INBK any more due to its soft numbers.

    Sam

  • sambordulac by sambordulac May 15, 2014 11:08 AM Flag

    Anyone heard anything about the annual meeting yesterday?

    Any discussion about the resolution of credit issues, the need for selling of the bank?

    Thank you in advance.

    Sam

  • Lending side should grow. Mortgage side should break even by 2Q14 and start to contribute in a small way.
    I am expecting its pretax pre-provision operating income to be about 1.5% to 1.7% of asset for the remainder of the year, or net 1% ROA.

  • Reply to

    OUCH!

    by cenhuddude Apr 23, 2014 4:31 PM
    sambordulac sambordulac May 12, 2014 5:43 PM Flag

    Thank you very much for the response, Cenhuddude.

    This Board member is out and there is whistle blower law suit brought about by former Chief lending officer. Who was alleged to be fired when opposing certain deal. The set up was that the Director gets legal fee from the bank as well as from borrower. Annual billing was around $400,000 annually. He had every incentive to push loans through and the loan officer got in his way.
    The consent letter specifically target the boards fitness to be director, the first of its kind that I ever saw. I presume it was meant to get rid of this particular lawyer/director.

    Now that he is gone and the new Chair and the new management are firmly in place. Actually the clean up already began, credit and other related cost are on-going. This pushed operating profit into the red, then the huge provisions...

    It's still not clear how long this high overhead would carry on. My sense is that the majority of provision for credit losses were already made.

    There is also ongoing lawsuit brought against he bank and the cost and loss are hard to gauge. This is on top of the tarnished reputation of the bank.This resulted in a much weaker financial at the bank. It may well get weaker. I agree your concern is well founded.

    I am also somewhat concerned that with weakened financial the bank may secure additional capital at unfavorable terms, mainly selling new shares on the cheap.

    You mentioned that there are other opportunities. I wonder if you can share them in this space. I'd appreciate it very much.

    Best,

    Sam

  • Reply to

    OUCH!

    by cenhuddude Apr 23, 2014 4:31 PM
    sambordulac sambordulac May 8, 2014 8:25 PM Flag

    Greetings, CHDude,

    I am interested in thrifts in need of merger.
    New here. What's the story with Hometown Bank?
    more to the point, what's the likely take out value?
    Thanks in advance.

    Sam

  • sambordulac sambordulac May 8, 2014 5:22 PM Flag

    What you said is true. It happened at WIBC, NARA, etc. too.
    So what are your choices?
    This may be a small comfort. This type of "common" rape requires certain conditions, it may be several years before that were to happen again.

  • Reply to

    1Q14 ugly

    by sambordulac Apr 29, 2014 8:47 AM
    sambordulac sambordulac May 7, 2014 11:04 PM Flag

    CLBH apparently have hit the bottom on earnings. Would share price bottom too? I don't know. However, I don't mind nibble at low 9s. , but only a small position and only for a trade.
    The easy money was made already..

  • Reply to

    1Q14 ugly

    by sambordulac Apr 29, 2014 8:47 AM
    sambordulac sambordulac Apr 30, 2014 9:29 PM Flag

    Mr. BM,

    Mortgage is a permanent feature of the landscape and it should be a contributor to profit, albeit that is going to be lumpy due interest rate swings. Purchase mortgage origination (only 25% of the recent peak) tend to be quite stable, what the bank needs to do is right-size its staff. The loss it experienced in 1Q was not shares by many other mortgage banking operators, I am not worried about repeated losses ion that sector. In other words, I am not worried for CLBH. Actually I'd be interested to buy CLBH at below $9 just for fun. It's not going to be a serious commitment because timing of recovery is less predictable this round.

    US housing starts recovered to 1 million units annualized, but that is still short of the 1.5 million long term average demand. What this means is that at some point , when people can afford to buy homes again, we'll see a shortage, a very bad shortage that may push housing prices up. If we have prolonged under-trend housing starts, as we seemed to be in, housing price could surpass that of bubble era. Bust to boom again.

    I'll probably be mostly out of banking by then, and be heavily into building materials, etc.

    Sam

  • Reply to

    1Q14 results

    by sambordulac Apr 17, 2014 6:12 PM
    sambordulac sambordulac Apr 29, 2014 9:12 AM Flag

    Mr. BM,

    Looking far enough back you find any justifications... Just kidding.

    Note its historical valuation was probably high due to two reasons:

    Banking overhead has gone up with the passing of Dodd-Frank, but the bank has the opportunity to improve its operation from its thrift mode. The bank needs to diversify aways from housing. Liberty Bank did it. Whether Burke can do it remains to be seen. Burke is too cozy with the board and probably too complacent.

    The other reason has nothing to do with management but simply the likely increase of inflation--in five, ten years--which will reduce the valuation of equity, banks in particular.

    I am neutral on GFED which means I would sell if I own it now. Like everyone else, if I have limited resource I'd put money on my better ideas. This is not one of them.

    Still buying USBI. USBI is somewhat cheap and it's burdened with credit. But once credit is sorted out, the immense earning power will show through. This is one of my top five.

    Best,

    Sam

  • sambordulac by sambordulac Apr 29, 2014 8:47 AM Flag

    This is even worse than my reduced expectations. The solace is that there were several one-time items that won't repeat.

    The bright spot is in net interest margin. Keeping up with this alone would make the bank sufficiently profitable.

    Mortgage banking will still be a factor, but nothing like 2010 to 2013 period. The bank is building its presence in Winston-Salem. I trust the management knows what they are doing.

    The bank is growing. Too bad we have so many changes on the board and the management team. But it is what it is. Que cera, cera.

    This may still be a somewhat above average operation. $10.57 seems reasonably close to its value.

BNCN
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