Columbia Banking initiated with a Neutral at UBS

UBS initiated coverage of Columbia Banking (COLB) with a Neutral rating and $23 price target. While the bank’s combination with Umpqua Holdings (UMPQ) should create long-term value for shareholders if well executed, UBS has short-term concerns about investor reaction to the earnings mix and initial capital levels following the close, the analyst tells investors in a research note. The firm believes that it is worth waiting for a larger margin of safety, or greater clarity on earnings and capital, before becoming more constructive on the stock.