NEW YORK, April 25, 2022 (GLOBE NEWSWIRE) — Keefe, Bruyette & Woods, Inc., a leading specialist investment bank to the financial services and fintech sectors, and a wholly owned subsidiary of Stifel Financial Corp. (NYSE: SF), today named 17 U.S. banking institutions to its coveted 2022 Bank Honor Roll.
KBW Bank Honor Roll winners are publicly traded banking institutions with more than $500 million in total assets that consistently reported increases in earnings per share over the last decade. To account for the impact of the adoption of current expected credit loss (CECL) accounting on 2020 earnings, banks that met the annual earnings-per-share growth requirements for all years save 2020 are eligible for inclusion if, in 2020, they reported an annual profit and annual pre-tax, pre-provision net income per share growth.
KBW found that 17 banking institutions, just 5% of all banks screened, qualified for inclusion on the 2022 KBW Bank Honor Roll, compared to 16 institutions in 2021.
14 of the 17 members of the 2022 KBW Bank Honor Roll are returning members, including: 1st Source Corporation (SRCE), Associated Banc-Corp (ASB), BancFirst Corporation (BANF), Bank First Corporation (BFC), First Financial Bankshares, Inc. (FFIN), German American Bancorp, Inc. (GABC), Greene County Bancorp, Inc. (GCBC), Lakeland Financial Corporation (LKFN), Premier Financial Corp. (PFC), SB Financial Group, Inc. (SBFG), ServisFirst Bancshares, Inc. (SFBS), Timberland Bancorp, Inc. (TSBK), U.S. Bancorp (USB), and Western Alliance Bancorporation (WAL).
The three new additions to the KBW Bank Honor Roll in 2022 are Axos Financial, Inc. (AX), The First of Long Island Corporation (FLIC), and Plumas Bancorp (PLBC).
“The U.S. economy rebounded in 2021, as COVID-19 vaccinations became widely accessible and proved highly effective,” said Thomas B. Michaud, KBW President and CEO. “Banks benefitted from the rebounding economy and the overhang of credit risk was removed, supporting both earnings growth and bank stock outperformance. The KBW Bank Honor Roll showcases those best-in-class banking institutions that deliver consistent growth for their investors. These banks are also rewarded by the market and receive premium valuation multiples.”
Over the five-year period ending in 2021, KBW Bank Honor Roll members posted better-than-industry price performance, rising 8.2% compounded annually on an average basis. This represents outperformance relative to both the KBW Nasdaq Bank Index (BKX) and KBW Nasdaq Regional Banking Index (KRX)’s five-year compound annual growth rates of 7.6% (59 basis points of outperformance) and 2.5% (563 basis points of outperformance), respectively.
The KBW Bank Honor Roll members also garner premium valuations relative to their banking peers. At year-end 2021, KBW Bank Honor Roll members traded at 14.9x consensus 2022 EPS, at premiums of 21% to BKX banks and 9% to KRX banks. Similarly, at year-end 2021, KBW Bank Honor Roll members traded at 1.9x book value on average, at a 40% premium to both KRX and BKX banks.
Christopher McGratty, KBW Head of U.S. Bank Research, added, “Honor Roll banks have set themselves apart from their peers with their ability to deliver consistent growth regardless of the operating environment. 2021 was a year of positive momentum for the banking industry that ultimately led KBW to upgrade the group in September 2021. There were signs of inflecting loan growth, prospects for higher interest rates, and record levels of cash on bank balance sheets waiting to be put to work. At the same time, bank M&A activity returned with several strategic and notable mergers announced over the course of the year. We congratulate the 2022 KBW Honor Roll banks, which differentiated themselves from their peers with their commitment and ability to deliver consistent growth.”
KBW (Keefe, Bruyette & Woods, Inc., operating in the U.S., and Stifel Nicolaus Europe Limited, also trading as Keefe, Bruyette & Woods Europe, operating in Europe) is a Stifel company. Over the years, KBW has established itself as a leading independent authority in the banking, insurance, brokerage, asset management, mortgage banking and specialty finance sectors. Founded in 1962, the firm maintains industry‐leading positions in the areas of research, corporate finance, mergers and acquisitions as well as sales and trading in equities securities of financial services companies.
Neil Shapiro, (212) 271-3447