Bank stocks outperformed most of the broader market Thursday; trust and processing banking companies and credit card lenders posted some of the largest gains.
Large-cap financial stocks “is where people wanted to be,” said Brian D. Bertonazzi, the head of sales and trading at Sandler O’Neill & Partners LP. The gains in large-cap banking stocks over the last few days could signal a shift in investor sentiment away from community and regional banking companies, he said.
The American Banker index of 225 banks rose 0.3%, as did the index of top 50 banks, though the Nasdaq bank index, which has more midcap and small-cap components, rose only 0.1%.
MBNA Corp. of Wilmington, Del., rose 2.3%, while Providian Financial Corp. of San Francisco rose 1.7%. Elsewhere, Citigroup Inc. rose 1%, while Bank of New York Co. Inc. rose 2%.
However, Independent Bank Corp. of Ionia, Mich., was among the day’s best performers; its stock rose 4.5%. On Tuesday, Independent announced that it would take a fourth-quarter charge of 7 cents a share related to the termination of executives of Mepco Insurance Premium Financing Inc., which Independent acquired in April.
On Thursday, John Bergquist, a Sandler O’Neill analyst, reiterated his “buy” rating for Independent’s stock and added 5 cents a share to his core earnings estimate. He cited improving core earnings and credit quality for the stock’s rise.
PrivateBancorp Inc. of Chicago and R&G Financial Corp. of San Juan, Puerto Rico, were among the day’s biggest losers. Private fell 2.9%, while R&G fell 2.1%.
