It takes time for banks to remake themselves, but TCF Financial (TCF)
is underway with what will be a multiyear process of becoming a more
focused, higher-quality bank focused on middle-market depositors and
specialty lending. Although there will be some headwinds from this
transition, TCF's above-average asset sensitivity will ease some of
those challenges. My biggest issue with TCF at this point is the
valuation - while I'm on board with the idea of paying more for
asset-sensitive banks at this point in the cycle, TCF has enjoyed a very
strong run over the past year and banks like Comerica (CMA) and First Horizon (FHN) have fewer issues for similar premiums relative to fair value.
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TCF Financial's Specialty Lending Business Should Help Ease A Big Transition
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