On a bank roll: RASARA Strategies' Raymond Stewart saw solid returns from bank stocks. (Stock Update).

When Raymond C. Stewart, CEO of Briarcliff Manor, New York-based RASARA Strategies, forecasted that bank stocks were in for a boom last year, he wasn't kidding. His reasoning that interest rate cuts by the Federal Reserve Board combined with Washington's economic recovery package in the first part of 2002 would pump money into the nation's banks was right on the mark. And he was even more prescient when he decided to concentrate on regional banks that were using mergers to expand to get the biggest bang for his buck.

Stewart's Private Screening selections produced a strong 8.38% gain for the 52-week period from Oct. 16, 2001, to Oct. 15, 2002. By comparison, the Dow Jones industrial average fell 12.03%, going from 9,384.20 to 8,255.68, and the Standard & Poor's 500 index slipped 19.70%, going from 1,097.54 to 881.27 over the same time period.

The top performer among Stewart's picks was Marshall & Ilsley (NYSE: MI), a Milwaukee-based bank that enjoyed a 2-for-1 stock split on June 17, 2002, which led to an overall gain of 1.19% since recommendation. Benefiting from interest income and data processing operations, the firm could build on its split-adjusted price of $27.98 in the coming year as the economy picks up.

Another big winner was North Fork Bancorp (NYSE: NFB), a Melville, New York, bank that racked up a 40.50% gain, climbing from $27.04 to $37.99. The bank's recent acquisitions and pristine credit rating were the primary reasons for its stellar performance in one of the worst markets in years.

Shares of New York Community Bancorp (Nasdaq: NYCB) went from $27.68 to $29.03, a modest 4.88% increase. The bank held its own in the competitive mortgage market in the New York region. Its strong credit profile helped keep the bank in the black.

Memphis, Tennessee-based National Commerce Financial Corp. (NYSE: NCF) also enjoyed a modest benefit from several key acquisitions. The stock moved from $23.05 to $24.52, posting a 6.38% gain.

And finally, Greater Bay Bancorp (Nasdaq: GBBK), based in Palo Alto, California, was the one losing pick among Stewart's selections. After several acquisitions boosted the bank's assets in 2001, its fortunes soured and the bank wound up posting a loss of 11.06%, dropping in price from $20.80 a share to $18.50.

Raymond Stewart's Private Screening Performance

                                                 Current Value
Company                               Total        of $1,000
Exchange: Symbol                     Return *     Investment

North Fork Bancorp NYSE: NFB           40.50%      $1,404.96

N.Y. Comm. Bancorp Nasdaq: NYCB         4.88        1,048.77

Greater Bay Bancorp Nasdaq: GBBK      -11.06          889.42

National Commerce Bank NYSE: NCF        6.38        1,063.77

Marshall & Ilsley NYSE: MI              1.19        1,011.93

Portfolio Performance                   8.38%      $5,418.86

* TOTAL RETURN REFLECTS STOCK APPRECIATION
AND INCLUDES STOCK SPLITS AND DIVIDENDS SOURCE: YAHOO! FINANCE