Old National vs Cullen/Frost Bankers
Old National Bancorp has grown through acquisitions across the Midwest into a regional banking force while Cullen/Frost Bankers runs one of Texas's most respected community banks with an unusually conservative balance sheet and a deep local deposit franchise. Both are regional banks that avoided the worst of the 2023 regional banking stress and now compete for investors who want quality bank exposure without the credit risk baggage of larger peers. Old National vs Cullen/Frost Bankers compares an acquisitive growth strategy funded by deal synergies against an organic relationship banking model, revealing how efficiency ratios, credit culture, and deposit cost sensitivity diverge between two well-managed but philosophically different regional bank franchises.
Old National Bancorp has grown through acquisitions across the Midwest into a regional banking force while Cullen/Frost Bankers runs one of Texas's most respected community banks with an unusually con...
Investment Analysis
Old National
ONB
Pros
- Old National Bancorp's adjusted EPS of $0.59 in Q3 2025 surpassed forecasts by over 5%, reflecting strong earnings momentum.
- The company achieved a 20% increase in loan production and 4.8% annualised deposit growth, indicating robust operational expansion.
- Successful integration of Bremer Bank has enhanced operational efficiency and strengthened the company's market position.
Considerations
- Old National Bancorp's stock trades near its fair value, limiting potential for significant near-term upside.
- Analyst price targets suggest only moderate upside, with consensus forecasts ranging between $24 and $28.
- The bank's future net interest income outlook remains dependent on stable interest rates, exposing it to macroeconomic volatility.
Pros
- Cullen/Frost Bankers reported a return on equity of 14.91% in October 2025, well above its historical average and industry peers.
- The bank maintains a strong market share in Texas, particularly among small to medium-sized commercial clients, supporting stable growth.
- Cullen/Frost is expanding into high-growth Texas markets such as Houston, Dallas, and Austin, broadening its regional footprint.
Considerations
- Cullen/Frost Bankers trades at a substantial premium to its fair value, raising concerns about valuation risk.
- The bank's exclusive focus on Texas exposes it to regional economic fluctuations and sector-specific downturns.
- Despite strong ROE, the company's dividend yield remains modest, limiting income appeal relative to some peers.
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Explore BasketWhich Baskets Do They Appear In?
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