We wanted to take a look at “all those other banks” out there that might have avoided the trouble that the big money center banks got into.  The screen pointed to M&T Bank Corp. (NYSE: MTB), Valley National Bancorp (NYSE: VLY), New York Community Bancorp Inc (NYSE: NYB), Hudson City Bancorp, Inc. (NASDAQ: HCBK), People’s United Financial Inc. (NASDAQ: PBCT), First Niagara Financial Group (NASDAQ: FNFG), Astoria Financial Corporation (NYSE: AF), Northwest Bancshares, Inc. (NASDAQ: NWBI), Cullen/Frost Bankers, Inc. (NYSE: CFR), United Bankshares Inc. (NASDAQ: UBSI), FirstMerit Corporation (NASDAQ: FMER), Park National Corp. (NYSE: PRK), Trustmark Corporation (NASDAQ: TRMK), Hancock Holding Co. (NASDAQ: HBHC), F.N.B. Corporation (NYSE: FNB) and Bank of Hawaii Corporation (NYSE: BOH).  In Canada there is Royal Bank of Canada (NYSE: RY), The Bank Of Nova Scotia (NYSE: BNS), Bank of Montreal (NYSE: BMO), and Canadian Imperial Bank of Commerce (NYSE: CM).It turns out that there are still many banks around the country that do pay higher dividends at above-market yields.

Our screen boiled down to a simple process.  We took a 3.0% Yield hurdle because that is what was implied as a future yield by JPMorgan this week if you use forward earning projections.  To avoid the micro-regional risks and to avoid the “so small no one cares if they fail” we also made a market cap hurdle of $1.0 billion.  After this we took a look at forward earnings expectations and also looked in the past to see what happened to their common stock dividends during the Great Recession when bank failure risks were systematic.

M&T Bank Corp. (NYSE: MTB) is based in Buffalo, NY and is the holding company for M&T Bank.  As of a year ago it had 793 banking offices in New York, Pennsylvania, Maryland, Delaware, New Jersey, Virginia, West Virginia, and the District of Columbia, as well as a branch in George Town, Cayman Islands. The company is in the process of acquiring another.

• Share price of $89.85 compares to 52-week range of $72.03 to $96.15
• Market Cap is $10.76 billion
• Thomson Reuters sees 2011 at $6.12 EPS and $3.77 billion in revenues
• Dividend of $0.70/quarter generates a yield of 3.2%
• Dividend history during recession was unchanged

Valley National Bancorp (NYSE: VLY) is the bank holding company for Valley National Bank and it had 197 full-service banking branches a year ago located throughout New Jersey and New York.

• Share price of $13.51 compares to 52-week range of $12.33 to $16.19
• Market Cap is $2.2 billion
• Thomson Reuters sees 2011 at $0.84 EPS and $550.98 million in revenues
• Dividend of $0.18/quarter generates a yield of about 5.3%
• Dividend history during recession was not effectively interrupted at all and it continued to pay a 5% stock dividend.

New York Community Bancorp Inc (NYSE: NYB) is the bank holding company for York Community Bank and New York Commercial Bank and as of a year ago it had 241 community bank branches and 35 commercial bank branches throughout New York.

• Share price of $18.92 compares to 52-week range of $14.40 to $19.33
• Market Cap is $8.24 billion
• Thomson Reuters sees 2011 at $1.33 EPS and $1.25 billion in revenues
• Dividend of $0.25/quarter generates a yield of 5.4%
• Dividend history during recession was unchanged at $0.25 per quarter since 2004.

Hudson City Bancorp, Inc. (NASDAQ: HCBK) is the bank holding company for Hudson City Savings Bank and as of a year ago it had 95 branches located in 17 counties throughout the State of New Jersey.

• Share price of $11.40 compares to 52-week range of $10.80 to $14.75
• Market Cap is $5.6 billion
• Thomson Reuters sees 2011 at $0.77 EPS and $966.6 million in revenues
• Dividend of $0.15/quarter generates a yield of 5.3%
• Dividend history during recession was actually raised during 2009 when others were eliminating or cutting the dividend.  The dividend has been this rate since mid-2009.

Last week on CNBC, Meredith Whitney told Maria Bartoromo, “… The banks have been all over the place so to say at this point and time the banks are off a little bit.  I don’t think there’s any way to make money on the banks.  But in terms, the regional banks for the state’s reason alone are in an impossible situation.  I would absolutely sell the regional banks.”  It can’t get much stronger of a call against the regional banks.

JPMorgan sees the world a bit differently.  The brokerage and banking giant is out loosely defending and recommending regional banking stocks.  This research note calls for increased exposure to the regionals.  The reason is based on credit improvement and as loan balance contractions are slowing.  Despite the economic recovery’s pace having slowed down, JPMorgan feels that this is now reflected in current valuations.  The call also notes that some of the regionals are likely to see double digit returns through 2011.

It is interesting when you see analysts using the same information and coming to opposite conclusions.  That is what makes a ballgame.

JON C.OGG

The famed hedge fund manager took a massive stake in Citigroup and sold his entire interest in Goldman Sachs

• Bank of America (NYSE: BAC) was listed as 159,794,229 shares, down from 167,990,464 shares.
• Capital One Financial Corp. (NYSE: COF) was static as a stake of 17,000,000 shares of common stock.
• Citigroup Inc. (NYSE: C) is listed as 300,000,000 (three-hundred million) of common stock.
• Fifth Third Bancorp (NASDAQ: FITB) was static as a 5,000,000 share stake.
• First Horizon National Corp. (NYSE: FHN) was 7.11 million, up from a stake of 3,000,000 shares in August.
• JPMorgan Chase & Co. (NYSE: JPM) was down to 2,000,000 shares, down from an August stake of 7,000,000 shares of common stock.
• Marshall & Ilsley Corp. (NYSE: MI) was static at 12,000,000 shares of common stock.
• People’s United Financial Inc. (NASDAQ: PBCT) was static at 2,750,000 shares of common stock.
• Regions Financial Corp. (NYSE: RF) was static at 35,000,000 shares of common stock.
• SunTrust Bank Inc. (NYSE: STI) was static at 1,500,000 shares of common stock.

We had also noted back in October how Conseco, Inc. (NYSE: CNO) had scored a Paulson investment.

Goldman Sachs Group Inc. (NYSE: GS) was NOT in the new filing compared to the August filing where he listed 2,000,000 shares of common stock in the August filing.  State Street Corp. (NYSE: STT) was NOT in the filing versus a stake of 700,000 shares of common stock in August.

JON C. OGG

• Bank of America (NYSE: BAC) was listed as some $2.217474 billion stake via 167,990,464 shares.
• Capital One Financial Corp. (NYSE: COF) was listed as $371.960 million via a stake of 17,000,000 shares of common stock.
• Fifth Third Bancorp (NASDAQ: FITB) was listed as $35.5 million via a 5,000,000 share stake.
• First Horizon National Corp. (NYSE: FHN) was listed as $36 million via stake of 3,000,000 shares of common stock.
• Goldman Sachs Group Inc. (NYSE: GS) was listed as $294.88 million via a stake of some 2,000,000 shares of common stock.
• JPMorgan Chase & Co. (NYSE: JPM) was listed as $238.77 million via a stake of 7,000,000 shares of common stock.
• Marshall & Ilsley Corp. (NYSE: MI) was listed as $57.6 million via a stake of 12,000,000 shares of common stock.
• People’s United Financial Inc. (NASDAQ: PBCT) was listed as $41.443 million via stake of 2,750,000 shares of common stock.
• Ultrashort Financial ProShars (NYSE: SKF) was listed as $83.58 million via some 2,000,000 shares.
• Regions Financial Corp. (NYSE: RF) was listed as $141.4 million via a stake of 35,000,000 shares of common stock.
• State Street Corp. (NYSE: STT) was listed as $33.04 million via a stake of 700,000 shares of common stock.
• Suntrust Bank Inc. (NYSE: STI) was listed as $24.675 million via a stake of 1,500,000 shares of common stock.

The FULL SEC FILING is here, and there are many non-financial stocks in there.

JON C. OGG
AUGUST 12, 2009