This week’s Stock of the Week is an experienced bank focused on slow-and-steady growth.

Bucks from Boring

Dime Community Bancshares, Inc. (DCOM) has discovered the secret to operating at much-lower-than-average cost despite being in a high-cost area.

Based in Brooklyn, New York, and in business since 1864, Dime has only 27 offices—in the New York City boroughs of Brooklyn, Queens and the Bronx and nearby Nassau County. It does not operate in high-cost Manhattan. It has long-term expertise in real-estate loans and has grown its loan portfolio slowly and carefully, looking for slow and steady expansion in a tortoise-rather-than-hare approach.

Dime owns a lot of its own real estate and keeps its branches low-key, without extravagance. It emphasizes community involvement and is well-known in the areas it serves. The result is that its expenses for traditional banking services are only about half those of other banks. Dime is now methodically growing its business-customer banking, expanding loans carefully and obtaining more non-interest-bearing deposits from corporate customers. Revenue was $151 million last year and will likely be $161 million this year and $173 million in 2018. The dividend of $0.56/share/yr. recently yielded 2.7% and appears secure.

Fiscal year: December. Earnings per share: 2018 est./$1.44…2017 est./$1.27…2016/$1.26.

Ryan C. Kelley, CFA, is vice president and portfolio manager of the $211 million Hennessy Small Cap Financial Fund (HSFNX), Novato, California. HennessyFunds.com.