Seeking Alpha

Volcker rule claims tiny victim

  • Community Bank System (CBU) will take a Q4 after-tax charge of $0.12 per share after selling its entire portfolio of bank and insurance trust-preferred CDO securities "in response to uncertainties created by the announcement of the final rules implementing the Volcker rule." The company earned $0.54 in Q3.
  • Hardly systemically important, the upstate New York bank has just $7.3B in assets. More on Volcker's unintended consequences.
  • Press release
Comments (3)
  • jyoung1891
    , contributor
    Comments (29) | Send Message
     
    That "tiny" little bank is the 138th largest out of almost 7000 banks in the country. $7 Billion in assets may be small compared to YOUR personal portfolio, but it isn't tiny.
    31 Dec 2013, 08:33 AM Reply Like
  • marloo
    , contributor
    Comments (17) | Send Message
     
    Banks used to be part of the free enterprise system and capitalism. Someday soon there will be only a handful of "too big to fail" banks.
    31 Dec 2013, 09:06 AM Reply Like
  • Bugle Boy
    , contributor
    Comments (80) | Send Message
     
    This has been a nimble and conservative bank in the traditional sense for decades. It's action may seem a knee jerk reaction, but it may mean a stronger institution. They spend their cash wisely.

     

    Although the area it serves has not done well this decade, the institution has been well guided and has had both intelligent internal growth and external growth through merger and purchases of small systems and groups of branches. It has been following this practice for 25 years or so.

     

    It also appears to have a corporate philosophy of serving the small population areas and for the most part avoiding the big business/metropolitan areas. Slow but steady. Many singles hit, rarely grounding out. Share price seems high based on its long term high/low price history.

     

    Not a bank to go to with a big idea, though. I have no security interest in CBU
    31 Dec 2013, 12:59 PM Reply Like
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