Legg Mason Keeps 'Sell' on Commerce Bancorp

Analyst Adam Barkstrom says he's increasingly concerned about the interest-rates risk picture

Legg Mason reiterates sell on Commerce Bancorp (CBH ).

Analyst Adam Barkstrom says the ratio of investment securities to assets now totals 56% of total assets at Commerce. He says his concern centers Commerce's reduction of tangible equity levels through reducing its available-for-sale gain on the company's bond portfolio, as the 10-year Treasury yield continues to climb.

Barkstrom notes this is exacerbated by the fact that Commerce is a high-growth story with very thin capital levels, which he thinks will force Commerce to slow growth, or, more likely, raise equity capital.