First Bancorp, the North Carolina-based regional lender, saw its stock climb to $26.95 on Tuesday, marking a new 52-week high. The share price has risen approximately 18% over the past three months, buoyed by improving sentiment toward US regional banks after a turbulent period in 2023 and 2024.
The stock's ascent comes as the broader KBW Nasdaq Regional Banking Index gained 1.2% on the same day, with investors betting that the Federal Reserve's pause on interest rate hikes will support lending margins. First Bancorp reported a net interest margin of 3.45% in its most recent quarterly update, slightly ahead of analyst expectations.
For UK investors, the development underscores the continued recovery of US regional lenders, many of which are held within global equity funds popular with British pension savers. The FTSE 100 edged up 0.3% to 8,247 points on Tuesday, partly tracking Wall Street's positive mood.
Analysts at Jefferies noted that First Bancorp's strong capital ratios and conservative loan book have helped it avoid the deposit flight that plagued some peers. 'The regional banking sector is stabilising, but we remain cautious on the pace of commercial real estate loan repricing,' they said in a note.
The stock's performance also reflects broader market optimism about a 'soft landing' for the US economy, with inflation cooling to 2.8% in June. However, any unexpected tightening by the Fed could reverse gains for rate-sensitive financial stocks.