Aristotle Small Cap Equity Fund’s Update on Columbia Banking System, Inc. (COLB)

Aristotle Capital Boston, LLC, an investment advisor, released its “Small Cap Equity Fund” third-quarter 2025 investor letter. A copy of the letter can be downloaded here. In the third quarter, the small-cap equities delivered strong results with the Russell 2000 Index reaching its first all-time high since November 2021. A favorable macroeconomic backdrop led the rally. In the quarter, the fund (Class I-2) delivered a return of 3.16% underperforming the 12.39% total return of the Russell 2000 Index. For more information on the fund’s best picks in 2025, please check its top five holdings.

In its third-quarter 2025 investor letter, Aristotle Small Cap Equity Fund highlighted stocks such as Columbia Banking System, Inc. (NASDAQ:COLB). Columbia Banking System, Inc. (NASDAQ:COLB) is a Bank holding company of Columbia Bank. The one-month return for Columbia Banking System, Inc. (NASDAQ:COLB) was 6.22%, and its shares gained 6.14% over the last 52 weeks. On December 18, 2025, Columbia Banking System, Inc. (NASDAQ:COLB) stock closed at $28.86 per share, with a market capitalization of $8.634 billion.

Aristotle Small Cap Equity Fund stated the following regarding Columbia Banking System, Inc. (NASDAQ:COLB) in its third quarter 2025 investor letter:

“Columbia Banking System, Inc. (NASDAQ:COLB) is a Washington state-based commercial bank that is in the early stages of winding down a large portfolio of low-yielding loans with organically driven higher-yielding relationship loans and lower-cost core deposit funding. A combination of operational-cost savings associated with the Pacific Premier Bancorp merger and an increased focus on increasing fee-based income should allow for higher-than historical profit margins and an attractive earnings-per-share (“EPS”) growth outlook, ultimately allowing for incremental share buybacks or dividend increases.”

Columbia Banking System, Inc. (NASDAQ:COLB) is not on our list of 30 Most Popular Stocks Among Hedge Funds. According to our database, 26 hedge fund portfolios held Columbia Banking System, Inc. (NASDAQ:COLB) at the end of the third quarter, compared to 28 in the previous quarter. While we acknowledge the risk and potential of Columbia Banking System, Inc. (NASDAQ:COLB) as an investment, our conviction lies in the belief that some AI stocks hold greater promise for delivering higher returns and doing so within a shorter time frame. If you are looking for an AI stock that is more promising than COLUMBIA BANKING SYSTEM, INC. (NASDAQ:COLB) and that has 10,000% upside potential, check out our report about this cheapest AI stock.

In addition, please check out our hedge fund investor letters Q3 2025 page for more investor letters from hedge funds and other leading investors.

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Disclosure: None. This article is originally published at Insider Monkey.