Long ago, in 1994, Outstanding Investor Digest had an interview where Cathay Bancorp was featured. Fires, recession (only in California), earthquakes, riots (separate from the OJ situation) and such made Cathay interesting in that it sold for 1x book value while earning 15% on equity. I bought the stock (that's not exactly the case but I'll write this to make it simple). East coast banks earning 10-12% on equity were selling for 2.5 to 3 x book.

Then in 1999 or 2000 (can't remember) East West came public while earning 18% its traditional on equity - it too came public at tangible book. All this while the east coast banks were getting bid up and bought by the likes of Fast Eddie Crutchfied (we called him Klutzfield) who said, "With the accounting we use we can pay 5x book for a small bank earning 10% on equity and 'make it work'". I bought East West too at the IPO.

Here is an interesting and well-done article on East West on SA. The long term table should help perspectives. As far as a bank, in my view it can't be beat.

Relevant is that Munger's money manager Li Lu has bought shares.

https://seekingalpha.com/article/4634616-an-invest...

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