Bancorp Rhode Island, Inc. (NASDAQ:BARI)

atreidi (86.70) Submitted: 10/23/2007 5:14:58 PM : Start Price: $31.59 BARI Score: -34.13

Run, Hide.

SBeren (29.36) Submitted: 10/22/2007 11:44:20 AM : Start Price: $32.09 BARI Score: -31.19

Rhode island's 3 largest banks have 85% of the market share. That leaves 15% for the small banks, like Bancorp, to fight for so I don't see much business for their commercial loans. And prospects for growth/new customers doesn't look good: Rhode Island economy has added slightly over 18,000 jobs since 2000, and has had virtually no growth in the median income bracket of $50,000/year. During the same time, health care premiums have gone up 35% and gas prices in Rhode ilsand have gone up almost 60%, and let's not forget expenses and other expenses... (Got Milk?). With 25% of their portfolio in residential mortgages, and another 20% in consumer loans, you're looking at almost 50% assets in a static, and possibly contracting (subprime?) asset. Furthermore, the Bank does not employ any outside mortgage originators, but periodically purchases residential mortgage loans from third-party originators - which raises a red flag for me about the quality of these loans... and if that wasn't a harbinger of bad things to come, maybe this is: At June 30, 2007, loan balances of $717,000 were 60 to 89 days past due, up from $476,000 at December 31, 2006. I don't think this bank has a lot of wiggle room; more likely than not, this stock will Underperform.