Episode Overview

Episode: ConnectOne's 4Q Beat Shows Ongoing Momentum: Earnings Outlook
Podcast: Bloomberg Businessweek
Date: February 6, 2026
Guests: Frank Sorrentino, Founder, Chairman & CEO of ConnectOne Bancorp
Hosts: Carol Massar, Tim Stenovec

This episode features an in-depth conversation with Frank Sorrentino, CEO of ConnectOne Bank. The discussion focuses on the bank’s recent strong earnings, consolidation trends in the US banking sector, the competitive landscape for regional banks, and enduring opportunities in small business and construction lending. Sorrentino also shares candid perspectives on the US housing shortage, infrastructure needs, and macroeconomic policy, including a new Federal Reserve Chair appointment.

Key Discussion Points & Insights

ConnectOne's Earnings and Market Momentum

• Recent Performance
  • ConnectOne Bancorp reported strong quarterly earnings, leading to a stock bump (~1.6% daily, ~7% YTD) and a new price target lift from Keith Bru Eden Woods to $32/share. (00:14–00:35)
  • Sorrentino projects optimism for 2026:

    "26 is a great year ahead of us, I really believe... things are looking really, really up." (00:47)

Market Consolidation & Foreign Investment

• Banking Landscape in the US
  • The US stands out globally with over 4,300 banks, fueling ongoing consolidation.
  • The current administration and regulators are accommodating M&A activity.
  • Sorrentino remarks on foreign capital's eagerness to enter the US, referencing a major deal highlighted by the hosts:

    "There's a lot of foreign capital that wants to find its way into the United States... We see that as a boon for us." (01:13)

Impact of Mergers on Community and Regional Banks

• Opportunities for Smaller Banks

  • Consolidation creates disruptions: changes in loan products, client uncertainty, and product phase-outs. Smaller banks are positioned to "pick up the pieces":

    "Generally, smaller banks are there to pick up the pieces... We're excited to see this transaction take place." (02:10)

• Acquisition Posture

  • Sorrentino maintains that ConnectOne strives to "make ourselves unavailable to be sold," but all banks should be open to acquisition inquiries:

    "Our job is to continue to make ourselves unavailable to be sold. But certainly that's always a possibility for every institution... It forces you to run your company in the best way possible." (02:43–04:06)

Growth Strategy & Client Needs

• Sophistication and Scale of Clients
  • The needs of ConnectOne’s clients, especially in the NY metro area, are evolving—demanding more complex banking products. Growth is necessary to serve clients as they expand:

    "If we're not growing ConnectOne, we're not going to be able to satisfy our clients' needs as they're growing... that's an incredibly important part of our organization." (04:58)

Outlook on Small Business, Construction, and Housing

• Stable Optimism in Construction Lending

  • Sorrentino expresses continued bullishness on construction, particularly multi-family, warehousing, and manufacturing:

    "There's just not enough product on the market... we are so woefully short, specifically here in the NY metro market... To say I'm optimistic would be an understatement." (06:14)

• Affordable Housing Obstacles

  • Real barrier isn’t capital or lending, but regulatory hurdles (zoning, environmental, insurance, local opposition):

    "The real impediment... is not because of capital and it's not because of bank lending... There's political change that has sort of crept into the system. You just can't build... Unleash the ability for builders to build and you'll have affordable housing." (07:16)

Infrastructure Investments

• Indirect Participation
  • ConnectOne typically isn’t large enough to finance massive infrastructure projects but benefits from the downstream economic activity:

    "I use the subway often here in New York. I mean, there's clearly a need for infrastructure spending just about everywhere." (08:50) "[Infrastructure spending is] great for the economy. They all need shovels. The workers need to go to the deli... and those are all the businesses that ConnectOne supports." (09:19)

Economic Policy and the Federal Reserve

• Fed Chair Appointment Commentary
  • Sorrentino welcomes the new chair’s data-driven approach, especially focus on Fed balance sheet over just interest rates:

    "The thing that I like the most is that he is data driven... Interest rates maybe aren't the most important thing we need to be focused on, but the Fed balance sheet is, and very few people want to talk about that... It is causing market distortions. And really, interest rates can afford to be lower if we get the Fed balance sheet under control. And I happen to absolutely agree with that position." (09:56–10:52)

Notable Quotes & Memorable Moments

• On US Banking Uniqueness:

  "The United States is sort of a rare breed across the globe where we have some 4,300 banks today, which you don't find in most countries." (01:13)

• On M&A and Value Creation:

  "The value is what someone's willing to pay you for it. Right? So... how do you set the company up to be the most profitable, the best market in the products that you provide?" (03:13)

• On Affordable Housing:

  "So unleash, unleash the ability for builders to build and you'll have affordable housing." (07:16)

Timestamps for Key Segments

• ConnectOne’s 4Q performance and outlook – 00:14–01:01
• Banking consolidation, foreign investment – 01:01–01:57
• Effects of mergers, ConnectOne’s M&A view – 02:10–04:06
• Client needs and growth strategy – 04:46–05:57
• Small business and construction optimism – 05:57–06:50
• Housing shortage, regulatory obstacles – 06:50–07:54
• Infrastructure & indirect bank role – 08:30–09:49
• Fed Chair appointment, balance sheet focus – 09:49–10:54

Summary & Takeaways

Frank Sorrentino’s appearance sheds light on the resilience and optimism within regional banking, navigating heavy industry consolidation and adapting to ever-evolving client needs. He is strongly optimistic about construction lending, recognizing affordable housing as stymied by regulatory barriers rather than lending constraints. Sorrentino also underscores the broad economic benefits of infrastructure investment—even if smaller banks aren’t direct lenders, they’re key supporters of the ecosystem around big projects. His data-driven, nuanced view on monetary policy and inflation rounds out a forward-looking, pragmatic perspective on both banking and the broader economy as 2026 unfolds.