- South Texas banks may take a short-term hit from Harvey, but analysts expect disruptions will be modest and could even lead to a longer-term pickup, WSJ reports.
- Regional banks Prosperity Bancshares (PB +0.5%) and Zions Bancorp (ZION +0.6%) have a respective 30% and 19% of their deposits in the Houston area, according to Barclays (LON:BARC) analysts, Allegiance Bancshares (ABTX +0.3%) has virtually all of its deposits in the Houston metro area, and Green Bancorp (GNBC +0.7%) has ~60% of its loans and deposits in the area; the respective stocks are down 2.9%, 2.2%, 7.5% and 8.9%, respectively, since Friday's close.
- PB closed ~25% of its Texas branches on Monday but had reopened many the next day - “We’re used to this," CEO David Zalman says, citing Texas’s history with past hurricanes.
- Based on patterns experienced in past storms such as Katrina and Sandy, analysts expect short-term loan activity to drop off and losses to pick up but in the past banks also have seen deposits surge in the wake of past storms as insurance claims paid out.
- “Headwinds are likely temporary,” Jefferies analysts say. “We expect the storm to have a positive impact as the rebuilding campaign pumps dollars into the local economy.”
- Now read: Bank Of America: Taking A Hit And What's Needed To Rebound
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