WSJ on Signature Bank

Sometimes I feel like we’re the only ones who know about Signature Bank (SBNY). For the bank, they probably don’t care about the attention. The bank gets a nice little write-up in today’s WSJ.

Signature Bank is a throwback to a simpler time in banking, a low-profile firm with a plain-vanilla business model focused on lending and deposits.

Then again, it is also one of the country’s quirkiest and fastest-growing banks, with an unusual collection of high-profile fans.

Among the bank’s admirers are former Congressman Barney Frank, who recently joined its board, and hip-hop producer Irv “Gotti” Lorenzo, who calls himself a Signature customer for life after the bank stood by him when he was facing money-laundering charges.

The New York bank, with its headquarters on Fifth Avenue in Manhattan, maintains only a handful of branches, most in the upper floors of office towers. By lending primarily to private businesses and affluent individuals in the New York metropolitan area, Signature has grown in its nearly 15 years of operation to about $30 billion in assets, making it now one of the 50-biggest banks in the U.S.

Investors, too, have discovered Signature: Its shares have increased more than 345% over the past decade, crushing the more-than-25% decline in the KBW bank index over the same period.

Fueled by 23 consecutive quarters of earnings growth, the bank has seen its asset growth outperform all other banks with more than $20 billion in assets as of the end of July, many of which have significantly more complicated structures and balance sheets.

“Banking in and of itself is a fairly simple business: You take deposits and make loans,” said Christopher McGratty, an analyst at Keefe, Bruyette & Woods. “These guys do that exceptionally well.”

Read the whole thing.

Posted by on August 31st, 2015 at 9:23 am

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