MCB

Metropolitan Bank ($MCB) Executives Signal Confidence with First Purchases in Year...Analysts Eye $90 Target

10/28/2025 23:18

Regional bank Metropolitan Bank ($MCB) is showing intriguing insider trading signals that warrant investor attention. The October 27 purchases by EVPs Frederik Erikson and Daniel Dougherty mark a notable shift from the consistent selling pattern by executives over the past year. Metropolitan Bank is a New York-based regional bank serving small-to-medium businesses and individual customers through commercial lending, deposit products, and treasury management services. With a $700 million market cap, this small-cap bank has focused on managing regulatory issues and commercial real estate exposure in recent years, including a complete exit from cryptocurrency assets in 2023 to concentrate on traditional banking operations. The most striking development is the change in insider trading patterns. President Mark DeFazio sold over 150,000 shares from July 2024 through June 2025, while EVP Scott Lublin also consistently reduced his holdings. However, the late-October purchases by two EVPs suggest a shifting internal perception of the current share price level. This change comes against the backdrop of Q3 results released in October. The company set aside $23.9 million in credit loss provisions due to a single commercial real estate loan, causing EPS to drop significantly to $0.67. However, this was a one-time event, with net interest income rising 18.5% year-over-year and solid loan growth momentum continuing. Investors should note the disconnect between market reaction and fundamentals. While shares initially declined after the credit loss announcement, 2025 year-to-date returns still stand at 27.6%, significantly outperforming the S&P 500. Wall Street analysts maintain unanimous buy ratings across all brokerages with a $90 price target. At current levels around $78, MCB trades at 1.06x book value, representing fair valuation relative to book. The 12x P/E ratio aligns with regional bank averages, while the 8.8% ROE and 21.7% operating margin compare favorably to industry peers. Particularly noteworthy is the liquidity position. Total cash holdings of $386 million exceed total debt of $313 million, providing a stable financial structure that can serve as a buffer against future credit losses or regulatory issues. From a technical perspective, positive signals are emerging. The stock has traded in a $47-$81 range over the past year, with current levels near the upper end suggesting potential for retesting 52-week highs and further upside. However, risk factors remain clear. Commercial real estate market uncertainty persists, and Fed policy changes could impact net interest margins. Additionally, compliance improvements following a $30 million fine from the Fed and New York regulators in 2023 continue. Looking ahead, CEO Mark DeFazio expressed cautious optimism about resolving problem loans by year-end or early next year. He also anticipates strong earnings momentum in 2026 following completion of technology investments in Q1. Short-term catalysts include the upcoming Q4 earnings release, where additional CRE provisioning and sustained net interest income growth will be key variables. Long-term, peak interest rate cycles could drive net interest margin improvement and credit cost normalization as upside drivers. In conclusion, MCB represents a regional bank maintaining solid fundamentals despite one-time credit losses. Recent insider purchases and consistent analyst buy ratings suggest investment appeal at current prices, though continued monitoring of commercial real estate exposure and interest rate risk remains essential.