Oppenheimer Lowers Sterling Bancshares Rating To Perform, Rescinds PT

While pressing for change at Sterling Bancshares, Inc. SBIB could contribute to improved and more consistent profitability in the future, Oppenheimer reports that it does not reverse the past decision to grow the out-of-Texas commercial real estate portfolio nor will it alter the unfriendly rate environment. “To management's credit, the company exited the mortgage business in 2003 and has grown core deposits in recent years, improving the franchise value of Sterling,” Oppenheimer writes. “With SBIB outperforming its peers this year and now within ~5% of our $6.50 PT, we are lowering our rating to Perform and rescinding our PT.” Sterling Bancshares currently trades at $6.16.