Mr. Hagerman: For the moment, most of my attention is focused on certain smaller, regional banks in both of those geographies. Specifically, I am more focused on the Southern California region of the country, including my coverage of PacWest Bancorp (PACW), City National (CYN) and CVB Financial (CVBF).
TWST: How would you characterize the industry in general over the last six months?
Mr. Hagerman: For the most part, operating results have stabilized. However, we continue to see some differences among institutions in terms of the magnitude of credit deterioration, level of operating losses and prospects for a return to profitability. Unfortunately, many of these banks continue to operate at a loss and have yet to return to sustained profitability. But on the positive front, we are starting to see more tangible signs of stabilization within the credit quality metrics of these institutions.
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