Episode summary
ConnectOne's 4Q Beat Shows Ongoing Momentum: Earnings Outlook | Bloomberg Businessweek
Bloomberg Businessweek Daily
· · 11 min · Hosts: Carol Massar, Tim Stenovec · Guests: Frank Sorrentino
Summary
Frank Sorrentino said ConnectOne is seeing a favorable operating backdrop in 2026, pointing to consolidation in U.S. banking, stronger client demand, and a healthy market for the kinds of commercial and construction loans his bank specializes in. He argued that a fragmented U.S. banking system, with about 4,300 banks, is naturally consolidating and that larger transactions often create openings for smaller lenders like ConnectOne when clients lose products or service continuity.
He was also upbeat on the construction, multifamily, industrial warehouse, and manufacturing segments, saying housing supply remains far short of demand in the New York metro area. On the Trump administration’s housing ideas, he backed affordability-focused efforts but said the real bottleneck is political and regulatory friction that makes it hard to build.
Sorrentino also said infrastructure spending should support a wide range of local businesses that ConnectOne finances, though the projects themselves are generally too large for the bank’s balance sheet. On monetary policy, he praised the newly chosen Fed chair as data-driven and agreed that the Fed balance sheet, not just interest rates, is a key issue for markets.
Key takeaways
- Sorrentino said consolidation across roughly 4,300 U.S. banks is a tailwind for smaller lenders like ConnectOne because clients need replacement products and service.
- He said ConnectOne remains optimistic on construction, multifamily, industrial warehouse, and manufacturing lending because supply is still well below demand.
- Sorrentino argued that housing affordability is constrained more by zoning, environmental, and local political barriers than by bank lending or capital availability.
- He said infrastructure projects are usually too large for ConnectOne to finance directly, but they create downstream business for the bank’s customers.
- Sorrentino called the new Fed chair data-driven and agreed that the Fed balance sheet matters more than interest rates alone.
Notable quotes
“there's a lot of consolidation going on in the US markets uh for for financial institutions”
“our clients are getting larger, they're getting bigger, they're entertaining M&A, and so they're leapfrogging in size”
“there's just not enough product on the market and and when it comes to, you know, apartments and homes and condos, we are so woefully short”
“the real impediment and the reason why we don't have enough homes today is not because of capital and it's not because of bank lending”
“He wants to talk about that. And he is saying that Fed balance sheet is too big. It needs to be reigned in”
How the episode opens
Bloomberg Audio Studios podcasts radio news. — You're listening to Bloomberg Business Week with Carol Masser and Tim Stenc on Bloomberg radio. — Our next guest is already betting on the US has been for a while. We are talking about Connect One Bank which reported earnings last week. Stock uh is trading up about 1.6% uh today up about 5% in the past three trading sessions. And I should point out that Keith Bruett and Woods raising its price target on the stock to $32 a share. That Tim happening on Friday.
Great to have back with us Frank Santino. He's founder chairman and CEO of the New Jerseybased Connect One Bank. Has a $1.4 billion market cap up close to 7% so far this year. Welcome back. How are you? — I'm doing great. 26 is a great year uh ahead of us. I really believe I a lot of people said, you know, uh survive till 25. Well, here we are. It's uh 2026 and things are looking really uh really up. So, uh very confident about what's uh what's happening.
Well, as Carol mentioned, it's not just that you guys betting on the US. Uh Spain's largest bank betting big on the US. We already have foreign banks here. What's your view on the deal? What's the competitive landscape for the US and like for business?
Look, you know, there's a lot of consolidation going on in the US markets uh for for financial institutions. uh you know the United States is a sort of a rare uh breed across the globe where we have some 4,300 banks today uh which you don't find in most countries and so there's a natural consolidation going on. And we have a very very accommodative uh administration and regulatory agencies that are allowing for some of those uh M&A uh activities to take place.
From the episode’s captions: roughly the first two minutes, lightly cleaned. Keep watching on YouTube →
Topics
- regional bank earnings
- net interest margin outlook
- loan growth expectations
- bank consolidation
- consumer and housing market
Companies and tickers mentioned
- CNOB
- SAN
- ConnectOne Bancorp
- ConnectOne Bank
- Santander
- Webster Financial
- Bloomberg Intelligence
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Summary, takeaways and quote selection by Octagon. Quotes are short excerpts; the full conversation is in the episode.
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