Many banking companies — including those with Tristate operations — could benefit from a rebound in the manufacturing business should the economy heat up, at least one banking analyst predicts.

        Peter J. Winter of CIBC World Markets is more optimistic that Midwestern banking companies — mainly targeting Cleveland's KeyCorp — could make more loans should manufacturing lead the economy out of recession.

        Mr. Winter told the American Banker that he has raised his rating on KeyCorp to “buy” from “hold.” He expects the share price of KeyCorp to increase once the economy turns around.

        His prediction came after the Federal Reserve Bank of Philadelphia's business-outlook report last week said that the general activity index rose from a revised reading of negative 12.6 in December to 14.7 this month, the first reading over zero since November 2000.

        Another Fed report last week showed signs of improvement in manufacturing in its Chicago district, which includes several Midwestern states.

        Mr. Winter predicts that many Midwest banks could outperform if the economy gets better. He said investors should consider those banking companies' stocks now because it will be too late once the recovery begins to buy at good prices.

        Mr. Winter also said KeyCorp — along with U.S. Bancorp — should benefit from a recovery. He figures those companies could see better credit quality, higher fee income and loan growth.

        Such a development could be a plus for KeyCorp, U.S. Bancorp and other regional banking companies hurt by the recession. Many regional banks this month have posted weaker fourth-quarter profits as the sluggish economy hurt credit quality.

        Not all analysts agree with Mr. Winter.

        Nancy A. Bush of Ryan, Beck & Co. told American Banker that KeyCorp's tightened credit standards could mean “measured growth.” She maintained her “hold” rating on the company.
       

Winton Financial hits record profits

        A hefty gain from the sale of mortgages helped Winton Financial Inc. post record profits for its fiscal first quarter.

        The Cincinnati-based parent of Winton Savings and Loan Co. earned $1.3 million, or 28 cents a share, up 41 percent from $900,000, or 20 cents a share, for the quarter ended Dec. 31, 2000.

        Winton reaped a $539,000 gain in mortgage banking income during the quarter, as lower interest rates sparked more home loans. Net interest income rose $350,000.

        The company also realized a $250,000 gain from the sale of deposits at its downtown branch to Foundation Savings Bank.

        Winton, with assets of nearly $485 million, is one of Greater Cincinnati's largest thrifts with six branches.
       

Westwood parent's profit a record

        Higher fee income helped the parent of Westwood Homestead Savings Bank in Cincinnati post record fourth-quarter profits.

        Camco Financial Corp. had net income of $2.52 million, or 33 cents a share, up from $1.95 million, or 28 cents a share, during the same period in 2000.

        For 2001, Camco earned $9.3 million, or $1.29 a share, vs. $7.6 million, or $1.10 a share, in 2000, before taking a charge.

        Including a one-time charge to merge its banking charters, Camco had profits in 2001 of $8.5 million, or $1.19 a share.

        Camco has 35 offices in Ohio, Kentucky and Indiana.

        Contact Jeff McKinney at 768-8499; fax 564-6991; or e-mail jmckinney@enquirer.com.

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