Focusing on Small Banks

I was lounging around Chez Melvin this week contemplating the Orioles' playoff chances when the Voo-Doo Professor sent me a spreadsheet of small banks with less than a billion dollars in assets, one of his latest projects. Dr. Mark McNabb, assistant director of the MS Finance Program at the University of Texas at Dallas, has apparently been looking at the same set of facts that I used to establish my Trade of the Decade thesis. Increased compliance costs are going to make it difficult for these banks going forward, so they are going to have to seek merger partners soon.

"With the writers of Dodd-Frank favoring the same industry leaders that required a bailout," McNabb said, "the small banks will become targets as they will find it easier to sell out than comply with the weight of regulatory excess and loss of business discretion and judgment to pursue opportunities in the marketplace."...606 more words left in this article. To read them, just click below and try Real Money FREE for 14 days.

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