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The Zacks Analyst Blog Highlights: BCB Bancorp, CB Financial Services, Triumph Bancorp and United Community Banks

Zacks Equity Research
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For Immediate Release

Chicago, IL – March 16, 2018 – Zacks.com announces the list of stocks featured in the Analyst Blog. Every day the Zacks Equity Research analysts discuss the latest news and events impacting stocks and the financial markets. Stocks recently featured in the blog include BCB Bancorp, Inc. BCBP, CB Financial Services, Inc. CBFV, Triumph Bancorp, Inc. TBK and United Community Banks, Inc. UCBI.

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Here are highlights from Thursday’s Analyst Blog:

Senate Banking Bill Loosens Key Dodd-Frank Norms: 5 Picks

On Mar 14, the Senate passed a crucial Bill easing several of the regulations, which were put in place to guard against a repeat of the 2008 financial crisis. The proposed legislation loosens norms mandated by the 2010 Dodd-Frank Act, which were put in place after the crisis led to many Americans losing their homes and jobs.

The major beneficiaries of the new legislation appear to be regional banks, smaller community banks, regional lending institutions and credit unions. Though larger banks also received crucial reprieves, these were minor compared to the relief received by their smaller counterparts.

The legislation now faces a crucial test in the House of Representatives, but given the bipartisan support it has received, smaller banks can expect easing up of regulations going forward. With rates set to rise and economic growth looking strong, investing in these banks looks like a smart option at this point.

Regional Banks Receive Reprieve

The Senate’s banking Bill aims to raise the threshold for banks which are deemed too big to fail. This limit, currently set at $50 billion in terms of assets, will now be raised to $250 billion. This implies that only the largest U.S. banks would have to abide by the most stringent regulations stipulated by the Federal Reserve.

This means that several midsized banks would no longer have to submit “living will” regulations which elaborately specify how banks intend to safely dispose of its assets in case of a failure.  Also, they would no longer have to undergo Federal Reserve stress tests on an annual basis.

The beneficiaries of this clause include household names such as BB&T, Fifth Third Bancorp, SunTrust and American Express.

Major Relief for Community Banks

Other major beneficiaries of the proposed law are smaller community banks and credit unions. Banks of this nature with less than $10 billion in assets will no longer have to comply with the Volcker Rule. This regulation prevents financial institutions from engaging in speculative trading. It was put in place to stop such banks from selling risky mortgages and to ensure that they could withstand difficult business conditions.

Smaller banks have complained for some time that they were subject to rules which were targeted primarily at bigger financial players. A more contentious reprieve intends to reduce reporting requirements for mortgage data. Additionally, smaller banks would no longer have to comply with strict mortgage underwriting norms put in place by the Dodd-Frank Act.

This rule was intended to determine whether banks were giving loans only to these individuals who had the ability to pay back these amounts. However, smaller banks have long complained that they find it difficult to comply with such regulations. The Bill’s supporters argue that the relaxation of these clauses will enable easier disbursal of mortgages and business loans, especially in rural areas.

Our Choices

The Senate’s new bipartisan legislation significantly eases norms for mid-sized and smaller banks. While their ease of doing business will increase substantially if the new law is implemented, compliance related costs will likely decline.

A stronger rate environment and an encouraging economic backdrop are already proving to be beneficial for banks. Given that regulatory restrictions are also likely to ease up in the near term, it makes sense to invest in smaller banks at this time. We have narrowed down our search to the following stocks based on a good Zacks Rank and other relevant metrics.

BCB Bancorp, Inc. operates as the holding company for BCB Community Bank, a state chartered commercial bank that provides banking products and services to businesses and individuals in the United States.

BCB Bancorp has expected earnings growth of 30.4% for the current year. The Zacks Consensus Estimate for the current year has improved by 14.3% over the last 30 days. The stock has a Zacks Rank #1 (Strong Buy). You can seethe complete list of today’s Zacks #1 Rank stocks here.

CB Financial Services, Inc. is the bank holding company for Community Bank, a chartered commercial bank.

CB Financial Services has a Zacks Rank #2 (Buy). The company has expected earnings growth of 22.8% for the current year. The Zacks Consensus Estimate for the current year has improved by 11.4% over the last 30 days.

Triumph Bancorp, Inc. is a financial holding company for TBK Bank, SSB with a diversified line of community banking, commercial finance and asset management activities.

Triumph Bancorp has a Zacks Rank #2. The company has expected earnings growth of 36.8% for the current year. The Zacks Consensus Estimate for the current year has improved by 0.9% over the last 30 days.

United Community Banks, Inc. is a bank holding company for United Community Bank that offers retails and corporate services to companies and individuals.

United Community Banks has a Zacks Rank #2. The company has expected earnings growth of 36% for the current year. The Zacks Consensus Estimate for the current year has improved by 0.6% over the last 30 days.

BB&T Corporation is a diversified financial holding company. BB&T is one of the major providers of banking and financial products in the United States.

BB&T Corp has a Zacks Rank #2. The company has expected earnings growth of 40.7% for the current year. The Zacks Consensus Estimate for the current year has improved by 0.5% over the last 30 days.

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Zacks Equity Research provides the best of quantitative and qualitative analysis to help investors know what stocks to buy and which to sell for the long-term.

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Past performance is no guarantee of future results. Inherent in any investment is the potential for loss. This material is being provided for informational purposes only and nothing herein constitutes investment, legal, accounting or tax advice, or a recommendation to buy, sell or hold a security. No recommendation or advice is being given as to whether any investment is suitable for a particular investor. It should not be assumed that any investments in securities, companies, sectors or markets identified and described were or will be profitable. All information is current as of the date of herein and is subject to change without notice. Any views or opinions expressed may not reflect those of the firm as a whole. Zacks Investment Research does not engage in investment banking, market making or asset management activities of any securities. These returns are from hypothetical portfolios consisting of stocks with Zacks Rank = 1 that were rebalanced monthly with zero transaction costs. These are not the returns of actual portfolios of stocks. The S&P 500 is an unmanaged index. Visit https://www.zacks.com/performance for information about the performance numbers displayed in this press release.

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CB Financial Services, Inc. (CBFV) : Free Stock Analysis Report
Triumph Bancorp, Inc. (TBK) : Free Stock Analysis Report
United Community Banks, Inc. (UCBI) : Free Stock Analysis Report
BCB Bancorp, Inc. (NJ) (BCBP) : Free Stock Analysis Report
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