Stock Picker: Banking On Regionals

"Any port in a storm," sailors are known to say. Collyn Gilbert of Stifel Nicolaus has found a port for stock market investors in the regional banks of the Northeast.

"As long as the market's focused on liquidity, capital, and funding, these small and medium-sized banks are going to do well," she told CNBC. "The transparency of the balance sheet and the absence of the derivative securities and credit default swaps is going to play very favorably into the pricing of these stocks."


She particularly likes New Jersey's Valley National, Connecticut's People's United Financial, and Pennsylvania's S&T Bancorp.

"The interesting thing about S&T is it's kind of in more rural markets," she said. "It's not levered to the consumer; you haven't had the real estate boom; you've got the economic backdrop in that part of the country with coal and natural gas; this is a company that's been able to take market share away from its competitors."

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People's United Financial and S&T Bancorp are investment banking clients of Gilbert's firm. The firm or an affiliate has received compensation from Valley National for investment banking services within the last 12 months.