Safe and Sound

All America Bank

Oklahoma City, OK
4
Star Rating
All America Bank is an FDIC-insured bank founded in 1969 and currently based in Oklahoma City, OK. As of June 30, 2017, the bank had equity of $43.0 million on assets of $411.5 million.

With 102 full-time employees in 7 offices in OK, the bank holds loans and leases worth $301.7 million, including real estate loans of $225.9 million. U.S. bank customers currently have $342.8 million in deposits with the bank.

Overall, Bankrate believes that, as of June 30, 2017, All America Bank exhibited a good condition, earning 4 out of 5 stars for safety and soundness. Keep reading for a breakdown of how the bank did on the three important criteria Bankrate used to grade U.S. banks.

WHAT IS
SAFE AND SOUND?

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THE INSTITUTION'S SCORE

Capital Score

Capital works as a bulwark against losses and affords protection for depositors when a bank is experiencing financial instability. It follows then that a bank's level of capital is an important measurement of an institution's financial strength. When looking at safety and soundness, more capital is better.
On our test to measure capital adequacy, All America Bank received a score of 10 out of a possible 30 points, below the national average of 13.38.

A bank's Tier 1 capital ratio is a commonly used measure of this buffer. All America Bank's Tier 1 capital ratio was 11.23 percent, higher than the 6 percent level considered adequate by regulators, but less than the national average of 25.16 percent. The higher the capital ratio, the better the bank will be able to stand up to economic difficulties.

Overall, All America Bank held equity amounting to 10.44 percent of its assets, which was lower than the national average of 12.10 percent.

Asset Quality Score

This test's purpose is to estimate how the bank's capitalization and allocated loan loss reserves could be affected by troubled assets, such as past-due mortgages.

Having large numbers of these kinds of assets could eventually force a bank to use capital to absorb losses, shrinking its equity buffer. Many of those assets are also likely to be in non-accrual status and no longer earning interest for the bank, resulting in diminished earnings and potentially more risk of a future failure.

On Bankrate's test of asset quality, All America Bank scored 32 out of a possible 40 points, lower than the national average of 37.62 points.

A useful indicator of asset quality is the percentage of problem assets a bank holds compared to its total assets. As of June 30, 2017, 1.81 percent of All America Bank's loans were noncurrent, meaning they were more than 90 days past due or were in non-accrual status. That's above the national average of 1.04 percent.

Banks maintain a reserve known as an "allowance for loan and lease losses" to deal with problem assets . Comparing the how large that reserve is to the total amount of at-risk loans can be a handy indicator when evaluating a bank's ability to manage problem assets. Unfortunately, the FDIC did not provide information on All America Bank's loan loss allowance in its most recent filings.

Earnings score

How profitable a bank is affects its long-term survivability. Earnings can be retained by the bank, giving a boost to its capital buffer, or be used to deal with problematic loans, likely making the bank more resilient in times of trouble. Banks that are losing money, however, are less able to do those things.

All America Bank scored 22 out of a possible 30 on Bankrate's earnings test, beating the national average of 16.52.

One widely used measure of a bank's earnings is return on equity, calculated by dividing net income (profit, basically) by total equity. All America Bank's most recent annualized quarterly return on equity was 12.70 percent, above the national average of 9.28 percent.

For the twelve months ended June 30, 2017, the bank earned net income of $2.7 million on total equity of $43.0 million. The bank had an annualized return on average assets, or ROA, of 1.38 percent, above the 1 percent deemed satisfactory in accordance with industry standards, and above the average for U.S. banks of 1.14 percent.

WHAT IS SAFE & SOUND?

Bankrate.com's Safe & Sound Ratings provide a star rating system to evaluate the current financial status of financial institutions. The information gathered about banks, credit unions and thrifts is updated as set forth in the Terms of Use of Safe & Sound Ratings and Reports. The Safe & Sound Ratings information is grouped by categories of banks, thrifts and credit unions.

Scoring methodology

Bankrate.com evaluates the financial condition of institutions and assigns a one- to five-star rating for each with five stars representing the highest rating. Institutions with satisfactory performance will generally receive a rating of three or more stars. The majority of institutions fall into the three- to four-star range. An institution with an "NR" rating may be too new to rate or may have limited the publicly available information in their regulatory filings. The "NR" is not an indication of financial strength or weakness. The Safe & Sound rating is believed to be reliable, but the information is not guaranteed. In addition, events since the information was collected may have altered the institution's financial condition.