City National Corp. was punished by Wall Street on Thursday the day after reporting first-quarter financials that failed to meet investor expectations.

Shares of the Los Angeles-based parent company of City National Bank fell 8 percent to $71.50 as investors received a mixed response to the earnings report from analysts.

The bank reported net income rose 3 percent to $57.2 million, or $1.12 per share, compared with $55.5 million, or $1.09, a year ago. Analysts polled by Thomson Financial forecast earnings of $1.21 per share.

Management lowered its earnings growth guidance for 2006 to a range of 8 percent to 10 percent for the year, from a range of 9 percent to 12 percent, citing blamed slipping interest margins, slower-than-expected deposit growth and a drop in real estate construction loans for the lackluster growth.

City National shares were downgraded to “hold” from “buy” by analyst Campbell K Chaney at Sanders Morris Harris, and cut to “market perform” from “outperform” by analyst Gary Townsend at Friedman, Billings, Ramsey & Co., with a 12-month price target $82 per share.

In contrast Jacqueline Reeves at Ryan Beck & Co raised her rating to “outperform” from “market perform,” with a 12-month price target of $78. Reeves expects the company to continue to expand the 55-office franchise by two to three offices per year.

While acknowledging that EPS that was 9 cents below Wall Street consensus and 12 cents short of his expectations, Adam Barkstrom at Stifel, Nicolaus & Company reiterated his “buy” rating, blaming the lackluster earnings primarily on a fall in net interest income.

“We continue to view the bank positively, as we believe they have a superior

deposit base and an attractive private banking model in what is arguably some

of the best markets in the world,” Barkstrom said in a note to investors.

City National’s revenues were up 5 percent from a year ago to $207.3 million. Total deposits at the end of the quarter were $11.9 billion, compared with $11.76 billion a year ago.