laut seinem Newsletter
Well I’ve always told myself and close friends that I wish I could start a bank. It’s a license to make money even when run conservatively. Some in recent months have hit the front pages when they weren’t so conservative – like Silicon Valley Bank which in turn produced a moderate financial crisis cratering the market prices of regional banks deemed susceptible to withdrawals of deposits. As a result many regionals are down 30%-40% since and it’s possible to own (or in effect) start a bank at 60%-70% of book value. Admittedly, regionals will have their cyclical problems if and when a recession occurs but my long-time wish to own a bank is now possible via public markets. Recent ROEs of 9%-10% at 60% of book provide an enticing long-term investment. Many smaller regionals may be gobbled up by larger counterparts at premium-to-market bids. I’ve become a banker by proxy. My purchases – not recommendations for legal purposes – include WAL, KRE (an ETF), SNV, and PACW.
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