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aligned with individual performance in 2022,”
says Kara Baldwin, a partner at Crowe. “Stock
prices were very erratic following the March
failures and not particularly reflective of reality
for a period of time.” She adds that pricing re-
“Stock prices were very erratic following
the March failures and not particularly
reflective of reality for a period of time.”
mains low compared to the rest of the market.
Investors are viewing banks differently, with
Kara Baldwin / Crowe LLP
short selling activity impacting the market —
an environment explored on pg. 6 of this report.
Today, long-term bank investors prize capital,
among other traits that can help a bank survive
large banks, and First Republic tied for No. 26.
an economic downturn. Regional bank stocks
Silvergate Capital Corp. was the first domino
have suffered, such as East West Bancorp’s, the
to fall, filing for bankruptcy in March 2023. It
top bank above $50 billion in assets. But the
ranked last among all banks in the ranking for
Pasadena, California-based bank’s leaders be-
its 2022 performance; for 2021, the crypto-fo-
lieve a long-term view on capital management
cused bank ranked No. 82 among peers with be-
could turn investor sentiment around.
tween $5 billion and $50 billion in assets.
Four banks that appear in this year’s ranking
Another bank serving the crypto sector, Sig-
met their end in spring 2023 due to depositor
nature Bank, actually performed better against
panic. “In the 30 years that I’ve been covering
many of its peers in 2022, tying for tenth with
banks, I’ve never seen liquidity get constrained
Capital One Financial Corp. and scoring well
that quickly,” says Mark Fitzgibbon, managing
across all metrics. Signature ranked similarly
director and head of financial services research
well for its performance in 2021. Unfortunate-
at Piper Sandler. “There was a perception during
ly, the bank’s strong performance didn’t prevent
2022 that the companies that had asset sensi-
a run on the bank’s deposits in March 2023.
tive balance sheets … would fare much better in
SVB, Silvergate, First Republic and Sig-
a higher interest rate environment.” That didn’t
nature operated fairly concentrated business
prove to be the case due to long-duration, low
models, notes Childs. The best banks — those
interest assets. The Federal Reserve paused its
posed to weather a potential storm ahead — do
rate hikes in June 2023, after raising them by
the opposite.
an unprecedented 500 basis points since March
“When you look at institutions that do well,
2022. The Fed resumed its rate increases in July
they have fairly diversified business models,”
2023, ticking up rates another 25 basis points.
Childs says. “They execute well, they have bet-
Three of those collapsed banks reported poor
ter than average rates on their asset side of the
performance last year. SVB Financial Group,
portfolio, and they’ve got good funding sources
which failed in March, and First Republic Bank,
that are stable and at a relatively low cost.”
which failed in May, ranked toward the bottom
among peers above $50 billion in assets. The
Emily McCormick is vice president of editorial &
previous year, SVB came in at No. 19 among the
research for Bank Director.