A Pair of Speculative Bank Plays

Life is full of irony and unintended consequences. More than three years since the height of the financial crisis, we still have banks that are too big to fail and are working through providing a proper regulatory structure. The monstrosity known as the Dodd-Frank bill is slowly moving along toward being implemented. Ironically, given that the focus was to punish big banks and ensure they could not bring down the financial system again, the bill may end up hitting the cost structure of smaller banks much harder than their bigger brethren. The additional costs and frustration of complying with the additional regulations is likely to drive many small banks into the arms of larger institutions, which was recently profiled in the Wall Street Journal. To profit from that likely outcome, I have selected two small banks that are bargains at current prices, with the kicker that I could easily see them being bought out at a premium in the future. Both have net insider buying, solid balance sheets and pay generous dividends.

Oneida Financial (ONFC) provides various banking products and services through 11 full-service branches in upstate New York....231 more words left in this article. To read them, just click below and try Real Money FREE for 14 days.

Read the full story and get access to the Real Money Pro trading floor.

There’s no substitute for a trading floor to get great ideas, so Jim Cramer created a better one at Real Money and blogs there exclusively. We then added legendary hedge fund manager, Doug Kass, with his exclusive Daily Diary and best investing ideas. Staffed with more than 4 dozen investing pros, money managers, journalists and analysts, Real Money Pro gives you a flood of opinions, analysis and actionable trading advice found nowhere else, and allows you to interact directly with each expert.

Already a Subscriber? Please login.

Except as otherwise indicated, quotes are delayed. Quotes delayed at least 20 minutes for all exchanges. Market Data provided by Interactive Data. Company fundamental data provided by Morningstar. Earnings and ratings provided by Zacks. Mutual fund data provided by Valueline. ETF data provided by Lipper. Powered and implemented by Interactive Data Managed Solutions.

TheStreet Ratings updates stock ratings daily. However, if no rating change occurs, the data on this page does not update. The data does update after 90 days if no rating change occurs within that time period.

IDC calculates the Market Cap for the basic symbol to include common shares only. Year-to-date mutual fund returns are calculated on a monthly basis by Value Line and posted mid-month.