The interest rate climate has contributed to lower expectations for Webster Financial Corp., despite its efforts to walk, talk, and act more like a banking company than a thrift.

Analysts' ratings have crept lower on the stock - to 1.8, or a weak "buy" rating, on First Call/Thomson Financial's scale of 1 to 5. The consensus rating for the Waterbury, Conn., company dropped 0.3% over the four-week period that ended last week, according to the American Banker affiliate that tracks analyst recommendations on stocks.

Earnings-per-share estimates have also been falling. On June 8 the consensus estimate dropped 4 cents, to $2.53, according to First Call. However, if the latest estimate is on target, Webster's earnings per share this year would still be 0.3% better than in 1999, First Call said.

Recent rating changes include downgrades last week by James M. Ackor of Tucker Anthony Cleary Gull to "hold" from "strong buy" and by Heather L. Dilbeck, of Ryan, Beck & Co., to "hold" from "buy." She also lowered her 2000 earnings-per-share estimate on the $10 billion-asset holding company to $2.50 from $2.64.

"Webster's margin has remained remarkably stable during the last couple of quarters, reflecting management's solid execution of a shift to a more bank-like balance sheet. However we believe that over the next few quarters the rising rate environment will work to delay balance sheet restructuring, and in the near term may restrain share performance," Ms. Dilbeck said in a published report.

"It's just not a good interest-rate environment for them to keep working on the restructuring of their balance sheet," she said in an interview. Kevin T. Timmons of First Albany Corp., who rated Webster a "strong buy" on April 6, said the company is also suffering from the appearance of risk because of its seven-figure syndicated loan to Safety-Kleen Corp.

Safety-Kleen, an industrial-waste recycler, last week missed debt payments on a promissory note, several senior notes, and a revolving credit facility, and the company filed for protection from creditors under Chapter 11 of the federal Bankruptcy Code Friday, seeking time so it can reorganize and pay its debts.

Nonetheless, Mr. Timmons remains optimistic. "What they are trying to do with the business mix and the balance sheet are important and will continue to be in the next few years," he said.

Webster shares fell 1.09% to $22.625, on Monday.

Elsewhere in the market, Parker/Hunter Inc., a regional brokerage in Pittsburgh, has initiated coverage on FleetBoston Financial Corp., Mellon Financial Corp., PNC Financial Services Group, and Bank of New York.

Analyst Sharanda Krishnappa said Parker/Hunter also hopes to start covering National City Corp. and Fifth Third Bancorp in the next six months.

The company already covers Wells Fargo & Co., Chase Manhattan Corp., Bank One Corp., Parkvale Financial Corp., Sky Financial Group Inc., Capital One Financial Corp., and Wesbanco Inc., Ms. Krishnappa said.

In other news, analyst John B. Moore Jr. of Wachovia Securities, downgraded Centura Banks Inc. to long-term "buy" from "strong buy" and his 2000 estimate to $4.10 from $4.25.

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