Regional Bank ETFs: Best and Worst Performing Banks

December 22nd at 11:00am by Tom Lydon

Despite the optimistic news coming from a few Wall Street bankers, a majority of financial institutions are struggling in the fledgling recovery. Let’s take a look at some of the best and worst banks, along with the exchange traded funds (ETFs) that hold them.

For 2010, 157 banks went under, as compared to 140 in 2009, while only a combined 98 banks have failed in the last 15 years prior, reports Kurt Badenhausin for Forbes. The FDIC still has a “problem list” with 860 institutions, and 123 banks missed their last TARP dividend payments.

Still, FDIC banks have gained $14.5 billion in profits in the third quarter. Capitalizations are better than they use to be. Furthermore, median risk-based capital ratio is now up to 15.5%. [Financial ETFs Spring Back to Life.]

Top healthy banks include:

  • For the second straight year, the Bank of Hawaii (NYSE: BOH), with $12.7 billion in assets, remains the healthiest U.S. bank. The bank remained conservative during the housing bubble, has reserves that are three times the size of nonperforming loans and is the second-best among big banks.
  • At second place, East West Bancorp (NYSE: EWBC) is the largest bank in the U.S. The bank’s assets have jumped 64% over the past year and returns was around 16.6%, fourth among large bankers.
  • Noteworthy mentions include No. 8 Commerce Bancshares (NYSE: CBSH) and No. 10 UMB Financial (NYSE: UMBF), which both kept nonperforming loans and assets in line.

Top faltering banks all have high levels of nonperforming loans and nonperforming assets. In last is Wilmington Trust (NYSE: WL). Wilmington also boosts the lowest Tier 1 risk-based capital ratio of 9.2%. Smaller banks continue to struggle because they can’t easily raise capital.

JPMorgan Chase (NYSE: JPM) placed at 44th and Wells Fargo (NYSE: WFC) placed at 71st.

For more information on the banking, visit our financial category.

  • SPDR KBW Regional Banking ETF (NYSEArca: KRE). WL is 0.56%. BOH is 2.05%. EWBC is 2.64%.
  • PowerShares Dynamic Banking (NYSEArca: PJB). BOH is 2.61%. CBSH is 2.75%. UMBF is 2.76%.
  • PowerShares S&P SmallCap Financials (NYSEArca: XLFS). EWBC is 3.07%.
  • First Trust NASDAQ ABA Community Bank (NYSEArca: QABA). CBSH is 3.51%. EWBC is 2.88%. UMBF is 1.73%.

Max Chen contributed to this article.

The opinions and forecasts expressed herein are solely those of Tom Lydon, and may not actually come to pass. Information on this site should not be used or construed as an offer to sell, a solicitation of an offer to buy, or a recommendation for any product.

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