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MAY 30, 2005
Angling For North Fork? North Fork Bancorp (NFB ) has caught the eye of Jacqueline Reeves, managing director at investment firm Ryan Beck (BBX ). She ranks the bank holding company, with 355 branches in New York, New Jersey, and Connecticut, as "one of the best in profitability and productivity" -- and an attractive buyout target. She says NFB fits the profile of a "consolidation candidate." It operates in markets "with alluring demographics and growth characteristics." NFB, with assets of $60 billion, has the financial flexibility bigger banks pine for, she adds. It has been paying down debt, and in the first quarter, loans soared 18%, deposits 20%, and demand deposits 22% -- "very solid numbers," says Reeves. Also, gains on mortgage loan sales soared 99%, to $105 million. Reeves says a giant rival such as Wachovia (WB ) seeking a foothold in New York State would be drawn to NFB, with its 4.6% market share on deposits of $30 billion. Wachovia does not have much New York presence but has 10.3% in New Jersey -- second only to Bank of America's (BAC ) 17%. Gary Townsend of securities outfit Friedman, Billings, Ramsey (FBR ) says he's upbeat on NFB, now at 27, for its fast growth, profitability, and top-notch management. He sees earnings of $2.27 a share in 2005 and $2.66 in 2006, vs. 2004's $1.81. His 12-month price target: 36. NFB hasn't indicated it is for sale, but it might well be -- after "a couple more acquisitions of its own," says Thomas Monaco of Moors & Cabot, who rates it a buy. NFB CEO John Kanas wouldn't comment on the buyout talk but says "we're continuing to build value for our shareholders." Wachovia declined comment. Note: Unless otherwise noted, neither the sources cited in Inside Wall Street nor their firms hold positions in the stocks under discussion. Similarly, they have no investment banking or other financial relationships with them.  By Gene G. Marcial
BW MALL
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