It's been awhile since the last time I've covered a bank trading at a discount to tangible book value. But, it's no surprise that the one I found just recently completed its second step conversion, boosting equity significantly faster than the market has moved the shares. Flush with cash, Waterstone Financial (NASDAQ:WSBF) is now in a spot where funding isn't a problem. New loan growth is the obvious path to higher returns, but the bank appears to have some of that already taken care of.
What's in store?
Before the conversion, Waterstone relied heavily on short-term FHLB (Federal Home Loan Bank) advances to fund customer loans that the deposit and equity accounts couldn't support. Unlike a complete sale,...
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