Thirty-eight banks and thrifts made Sandler O’Neill & Partners LP’s second annual “Sm-All Stars” list, and 16 of them are headquartered in California.
“It’s a testament to the growth coming out of California,” said Steve Alexopoulos, an associate director at Sandler O’Neill, which analyzed 573 publicly traded financial companies to compile the list of best performers.
Center Financial Corp. of Los Angeles was among the acknowledged California banks and also one of 14 companies to make the list for the second consecutive year.
“It’s a direct indication that California’s economy is doing fine,” said Paul Seon Hong Kim, the bank’s chief executive officer, who also attributed the phenomenon to the state’s steady population growth.
Vineyard National Bancorp of Rancho Cucamonga is another two-time winner from California. Chief financial officer Gordon Fong said the recognition “will give us more visibility as we communicate with new investors.”
Donavon Ternes, the CFO of Provident Financial Holdings based in Riverside, Calif., said receiving the honor for a second time provides credibility and shows that “we can outperform those that don’t [make the list].”
Collectively, the share price of the Sm-All Stars rose 22.8% last year compared to a 6.3% increase in Nasdaq’s bank index. The select banks nearly doubled the industry’s average growth while maintaining solid credit quality and returns on equity that rank in the industry’s top quartile.
Sandler O’Neill, a New York investment banking firm that specializes in financial services companies, says the list is designed to help investors identify the up-and-coming small-cap companies that are often overshadowed by larger competitors.
All 573 publicly traded banks and thrifts with market capitalizations under $2 billion were considered. They were assessed against eight criteria, such as loan and deposit growth, nonperforming assets, and capital strength.
