COLB - Columbia Banking System lands Overweight rating at Wells Fargo on Umpqua merger

Wells Fargo on Wednesday initiated coverage of Columbia Banking System ( NASDAQ: COLB ) with an Overweight rating following the completion of its previously announced combination with Umpqua Holdings ( NASDAQ: UMPQ ).

Earlier, COLB and UMPQ, both based in the Northwest, said the merger deal finally has been completed after waiting on a string of longer-than-expected regulatory approvals.

The combined company, with more than $50B in assets and around $37B in loans and $45B in deposits, now ranks as a top-30 U.S. bank.

Analyst Jared Shaw pointed out that Columbia Banking System ( COLB ) has the second lowest deposit beta in his coverage of 5%, leaving "upside potential as the deal closes," according to a note he wrote to clients.

That, in addition to solid balance sheet growth and a low-cost deposit base led Shaw to call for COLB's 2023 operating EPS of $3.92, surpassing the $3.63 average Wall Street estimate (6 estimates). For 2024, he expects operating EPS to be $4.32 vs. $4.00 consensus (6 estimates).

In early afternoon trading, COLB gained 0.6% and UMPQ didn't budge.

In January, Columbia Banking System and Umpqua Holdings received FDIC approval for the combination .

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