Berkshire Hills Bancorp (NYSE: BHLB) is my hometown bank and my Peter Lynch stock.

The great fund manager famously counseled Baby Boomers to “invest in what you know,” and sold them on the notion that they could “beat the Street” by deploying personal experience and local knowledge as investing tools.

The rest is some pretty unhappy history, so that just 15 years after Lynch’s heyday we find his ideas, if not exactly discredited, certainly marginalized by fears of insider trading, attention-deficit-disorder algorithms and other chicanery.

Yet it’s worth remembering that, throughout the 17-year bull market that Lynch rode to fame and fortune, his ideas worked out quite well for many. And even if the current four-year bull doesn’t live as long, investing in what you know beats investing in what you don’t any day.

So here’s what I can share about Berkshire Hills Bancorp after a couple of years of close observation:

• That it’s a highly successful lender strengthened by several well-timed, craftily selected and successfully integrated acquisitions, with a cohesive culture and devotion to rigorous performance tracking

• That in the tumult of the recent recession and its aftermath it went out and poached experienced, profitable commercial lending teams in some of Northeast’s most promising markets from bigger but less attentive and aggressive rivals

• That it’s headquartered in Pittsfield, Mass., a recovering company town painfully abandoned by General Electric (NYSE: GE), which has found salvation if not quite a cure in medicine, tourism and the arts while retaining a decent industrial base

• That the local economy is gradually but steadily improving, with unemployment down, home prices up and plans afoot for new hotels

• That Berkshire’s expansion into the Albany, NY and Hartford, Conn.,  markets places it in two state capitals with many relatively secure white-collar jobs and businesses, while the bank’s growing presence in central and eastern Massachusetts gives it access to another rich, dynamic region

• That the bank’s culture has been heavily influenced by Larry Bossidy, the respected former Honeywell (NYSE: HON) and Allied Signal CEO and Pittsfield native who spent a decade as Berkshire’s chairman before conceding that title to CEO Michael Daly but staying on as the lead director. Bossidy knows a thing or two about banking, after running GE Credit as chief operating officer, and he preaches the importance on finding and keeping the right people.

Daly is also a Pittsfield native who cut his teeth in commercial lending at the old Bank of Boston. He’s been with Berkshire since 1986 and the CEO since 2002, overseeing the transformation of a sleepy local thrift into a regional player with an enviable franchise. Berkshire markets itself as “America’s Most Exciting Bank” in a reflection of its leader’s relentless optimism.

Berkshire’s attractive financials are, of course, freely available online and don’t require venturing into the scenic Berkshires. But the bank is followed by just three Wall Street analysts and remains relatively unknown.

There’s a lot to like in the numbers:

• Nonperforming loans amounted to just 0.64 percent of the lending portfolio at the end of 2012, versus 3.07 percent for Wells Fargo (NYSE: WFC) and 4.29 percent at Hudson City Bancorp (Nasdaq: HCBK), the big East Coast thrift being taken over by M&T Bank (NYSE: MTB) at a roughly 50 percent premium to Berkshire’s current valuation, based on estimated 2013 earnings per share

• Net charge-offs were 0.28 percent of average losses in 2012, versus 1.17 percent of average loans for Wells Fargo

• Net interest margin, the spread between the interest a bank earns and the interest it pays, widened from 3.50 percent to 3.67 percent in the fourth quarter of 2012, while at Wells Fargo it was narrowing from 3.66 percent to 3.56 percent

• Fourth-quarter revenue rose 20 percent, aided by acquisitions, while on an organic basis excluding the empire-building deposits and loans grew 5 percent year-over-year. On an organic basis, loans have grown more than 20 percent over three years, while deposits have jumped nearly 25 percent over that span.

The stock now yields 2.8 percent annually based on the recently increased dividend, is trading near a four-year high and held up very well during the recent market pullback.

Daly is an ambitious man, and now that so many of the deals he’s made in recent years have come up roses, the question is whether he’ll continue acquiring or possibly consider selling the franchise he’s built. Its footprint might look particularly attractive to a Wells Fargo, which gained a strong mid-Atlantic base as a result of the Wachovia takeover, but doesn’t have a lot of branches in New England and upstate New York.

In any case, Berkshire Hills Bancorp seems to have been following the Peter Lynch game plan by seeking out local expertise, be it in retail banking or commercial lending. One of these days, the strategy could pay off big. And in the meantime the dividend is nothing to sneeze at.

Igor Greenwald is an investment analyst with The Energy Strategist.