* Upgrades from neutral
* Says Synovus to unveil cost savings soon
Nov 15 (Reuters) - Synovus Financial Corp (SNV.N) may come up with cost-saving plans to help restore profitability sooner than expected, analysts at Collins Stewart said, upgrading the regional bank to “buy.”
The lender, which has about $35 billion in assets, holds many commercial real-estate and construction loans in some of the worst markets in the country, making credit quality and return to profitability a major concern.
“Our sense is the management is preparing to unveil a specific set of programs designed to eliminate as much as $100 million of costs over the next 18 months, or about 8-10 percent of the estimated 2010 cost base,” analysts led by Todd Hagerman said in a note to clients.
“Management believes the potential cost savings plans are the ‘game changer’ for 2011,” the analysts said.
The brokerage said it hosted a series of meetings with Synovus’ top management, including CEO Kessel Stelling.
The analysts expect significant drop in problem assets and problem-asset inflows in the fourth quarter.
Synovus reported a wider-than-expected loss for the third straight quarter in October. [ID:nSGE69O0K2]
The Columbus, Georgia-based bank’s shares, which have slumped 16 percent since the company reported third-quarter results, were up 3 percent at $2.11 in morning trade on Monday on the New York Stock Exchange. (Reporting by Tenzin Dekeva in Bangalore; Editing by Vinu Pilakkott)