Dick Bove’s Top 3 Bank Stocks

Financial stocks appear to have plenty of upside ahead, Dick Bove of Rafferty Capital Markets said Thursday.

"For 14 quarters in a row, the banking industry has shown earnings increases on a year-over-year basis. In 2012, the banking industry earned $122 billion, which is in fact the second-highest ever in the industry for a full year," he said.

"In the first quarter of 2013, the banking industry earned more money than it's ever earned in any quarter ever."

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On CNBC's "Fast Money," the banking analyst said that the reason was simple.

"It's because there's an overall improvement of every facet of banking at the present time," he said.

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Bove noted rising prices for banking products, a decline in operating costs and understated values of existing assets as headwinds for financial stocks.

Among his top banking picks were:

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Trader disclosure: On May 30, 2013, the following stocks and commodities mentioned or intended to be mentioned on CNBC's "Fast Money" were owned by the "Fast Money" traders: Guy Adami is long C; Guy Adami is long GS; Guy Adami is long INTC; Guy Adami is long AGU; Guy Adami is long MSFT; Guy Adami is long NUE; Guy Adami is long BTU; Karen Finerman is long AAPL; Karen Finerman is long BAC; Karen Finerman is long C; Karen Finerman is long JPM; Karen Finerman is long GOOG; Karen Finerman is long JCP PUTS; Karen Finerman is long GM; Karen Finerman is short SPY; Karen Finerman is long MDY Puts; Jon Najarian is long AAPL ; Jon Najarian is long JPM; Jon Najarian is long FSLR; Jon Najarian is long TSLA; Jon Najarian is long EMC; Jon Najarian is long JOY; Jon Najarian is long ALTR; Jon Najarian is long COP; Jon Najarian is long GRPN; Jon Najarian is long HL; Jon Najarian is long OC; Jon Najarian is long TMO; Brian Kelly is long TLT; Brian Kelly is long YEN; Brian Kelly is short S&P Futures; Brian Kelly is short NIKKEI.