Miles Lewis Talks Small-Cap Banks in Barron’s—Royce
article 05-24-2023

Miles Lewis Talks Small-Cap Banks in Barron’s

What’s next for the banking sector? Miles Lewis discusses the small cap picks he likes.


PM Miles Lewis was recently featured in the Barron’s article, “What’s Ahead for the Banks as the Dust Settles After Failures” penned by Liz Moyer, that looked at the prospects for banks as they head for a “new world order.”

Read the piece (subscription required).

The article describes how “Investors, regulators, and companies are reassessing deposit flows, loan books, and balance sheets buckling from higher interest rates” before going on to say that “the next 12 months will be rocky, but there are opportunities in stocks that may be unduly depressed.”

Miles pointed out that for many banks tangible book values—a measure of liquidation value—are currently below where they were in 2008’s Financial Crisis. He also observed that new regulations for larger banks are unlikely to touch their smaller peers in material ways. He then offered detailed examples of banks whose long-term prospects he likes, including Bank United.

Read the piece (subscription required).

Learn more about Miles Lewis.

Important Disclosure Information

Average Annual Total Returns as of 3/31/2023 (%)

NET               GROSS
Pennsylvania Mutual 8.15 -1.30 21.46 7.24 8.53 N/A N/A  0.96  0.96
Small-Cap Total Return 2.30 -8.98 18.45 5.08 7.29 9.82 12/15/93  1.26  1.26
Russell 2000
2.74 -11.61 17.51 4.71 8.04 N/A N/A  N/A  N/A
Russell 2000 Value
-0.66 -12.96 21.01 4.55 7.22 N/A N/A  N/A  N/A
1 Not annualized.

All performance information reflects past performance, is presented on a total return basis, reflects the reinvestment of distributions, and does not reflect the deduction of taxes that a shareholder would pay on fund distributions or the redemption of fund shares. Past performance is no guarantee of future results. Investment return and principal value of an investment will fluctuate, so that shares may be worth more or less than their original cost when redeemed. Shares redeemed within 30 days of purchase may be subject to a 1% redemption fee, payable to the Fund, which is not reflected in the performance shown above; if it were, performance would be lower. Current month-end performance may be higher or lower than performance quoted and may be obtained at Operating expenses reflect each Fund's total annual operating expenses for the Investment Class as of each Fund's most current prospectus and include management fees and other expenses.

Mr. Lewis’s thoughts and opinions concerning the stock market are solely their own and, of course, there can be no assurance with regard to future market movements. No assurance can be given that the past performance trends as outlined above will continue in the future.

The performance data and trends outlined in this presentation are presented for illustrative purposes only. Past performance is no guarantee of future results. Historical market trends are not necessarily indicative of future market movements.

Percentage of Fund Holdings As of 3/31/23 (%)

  Pennsylvania Mutual Small-Cap Total Return




Company examples are for illustrative purposes only. This does not constitute a recommendation to buy or sell any stock. There can be no assurance that the securities mentioned in this piece will be included in any Fund’s portfolio in the future.

Frank Russell Company (“Russell”) is the source and owner of the trademarks, service marks and copyrights related to the Russell Indexes. Russell® is a trademark of Frank Russell Company. Neither Russell nor its licensors accept any liability for any errors or omissions in the Russell Indexes and / or Russell ratings or underlying data and no party may rely on any Russell Indexes and / or Russell ratings and / or underlying data contained in this communication. No further distribution of Russell Data is permitted without Russell’s express written consent. Russell does not promote, sponsor or endorse the content of this communication. The Russell 2000 is an unmanaged, capitalization-weighted index of domestic small-cap stocks. It measures the performance of the 2,000 smallest publicly traded U.S. companies in the Russell 3000 index. The Russell 2000 Value and Growth indexes consist of the respective value and growth stocks within the Russell 2000 as determined by Russell Investments. The performance of an index does not represent exactly any particular investment, as you cannot invest directly in an index.

This material is not authorized for distribution unless preceded or accompanied by a current prospectus. Please read the prospectus carefully before investing or sending money. Smaller-cap stocks may involve considerably more risk than larger-cap stocks. (Please see "Primary Risks for Fund Investors" in the prospectus.)



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