Investment Perspective: Customers Bancorp - Time to BuyInvestment Perspective: Customers Bancorp (NYSE:CUBI) - Time to Buy
Customers Bancorp (NYSE:CUBI), a bank based in West Reading, Pennsylvania, shows promising signs that make it an attractive candidate for investment. Based on data from the third quarter of 2023 and recent news, there are several key aspects that make CUBI interesting for investors:
1. Improvement in Financial Indicators: In the third quarter of 2023, the company reported a net income of $83 million, which amounts to $2.58 per share. This was accompanied by an increase in net interest margin to 3.7% and a growth in deposits by $244.9 million.
2. Positive Dynamics in the Sector: Customers Bancorp demonstrated an increase in net interest income to $200 million, a result of the impact of the variable rate both in the loan portfolio and in the securities portfolio. This distinguishes it from many other regional banks, where the "bottom" is expected to be reached only in the next quarter or in the first quarter of 2024.
3. Stability and Security: In terms of insured deposits relative to total deposits, Customers Bancorp is in the top quartile with a ratio of 78%. Additionally, the bank ranks second among its peers in terms of available liquidity to unsecured deposits, which is 239%.
4. Capital and Risk Management: The third quarter of 2023 saw a significant improvement in capital indicators compared to the previous quarter. In particular, the CET1 ratio improved by 100 basis points, and its further increase to 11.50% is planned in subsequent quarters.
5. Strategic Initiatives: The bank employs advanced approaches in managing its portfolio and attracting deposits, making it a unique hybrid bank. This highlights their ability to adapt and evolve in accordance with changing market conditions.
Of course, as with any investment, there are risks. For example, the situation with CUBI and cryptocurrencies, despite assurances from management about the absence of direct risk, requires careful consideration. It is also necessary to consider that CUBI has not yet been tested in crisis conditions.
