Regional Banks

The Bank of New York Company

The Company

The picture of consistency, Bank of New York <% if gsSubBrand = "aolsnapshot" then Response.Write("(NYSE: BK)") else Response.Write("(NYSE: BK)") end if %> has delivered solid growth to shareholders year-after-year. In the last three years, this New York and New Jersey bank has really started to turn up the results without taking undue risks. The secret is that non-interest income has now surpassed net interest income, the result of strong gains in securities processing fees and other financial market services. The company's balance sheet is fairly sparkling, as are profitability ratios such as return on assets and return on equity. Of particular interest is the company's return on assets ratio of 1.9% in 1996, which is an astounding performance and is actually more indicative of the company's results than its return on equity (ROE) measure of almost 20%. Priced at the same PE multiple as lesser-performing banks, the value is interesting but probably suffers from the same low-valuation syndrome that afflicts brokerage stocks.

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