Loyola Capital Corp. stock has risen 11 percent following the acquisition of two other thrifts Monday.
AmSouth Bancorp., based in Birmingham, Ala., signed a
definitive agreement to acquire First Chattanooga Financial Corp. for $106 million. Earlier, First Union Corp. of Charlotte, N.C., agreed to acquire DFSoutheastern Inc., parent of Decatur Federal Savings & Loan in Georgia, in a stock swap valued at $146 million.
But Loyola is not on the verge of any similar transaction and is not in any merger talks with anyone, Chief Financial Officer James McAveney said.
Loyola was up $2 yesterday, to $20.50 a share, on NASDAQ volume of 54,800 shares, more than eight times its three-month average daily volume of 6,500 shares.
The acquisitions show that banks are searching for inexpensive thrifts trading at a discount to book value, said John Heffern, analyst at Alex. Brown & Sons Inc. Loyola is trading at about 60 percent of its March 31 book value of $34.60. "It has people looking for value," he said.
First Union's acquisition of DFSoutheastern was priced at 1.13 times DFSoutheastern's book value, and the AmSouth-First Chattanooga merger was valued at 1.25 times First Chattanooga's book value, making them relatively inexpensive mergers, Mr. Heffern said.
Mr. McAveney said the DFSoutheastern deal was likely to spark interest in Loyola because Georgia-based DFSoutheastern and Loyola are about the same size and have similar management philosophies.
Jim Weber, analyst at Johnston, Lemon & Co., said the market wasn't recognizing Loyola's value. "They've had a strong earnings performance and an improving capital position," he said.
In the first quarter, Loyola's operating profit increased to $3 million, or 68 cents a share, from $2.3 million, or 50 cents a share, in the same quarter of 1991.