Safe and Sound

Barrington Bank & Trust Company, National Association

Barrington, IL
5
Star Rating
Founded in 1996, Barrington Bank & Trust Company, National Association is an FDIC-insured bank based in Barrington, IL. Regulatory filings show the bank having equity of $228.2 million on $1,959,769,000 in assets, as of June 30, 2017.

U.S. bank customers have $1.43 billion on deposit at 7 offices in IL run by 876 full-time employees. With that footprint, the bank has amassed loans and leases worth $1.68 billion, $699.8 million of which are for real estate.

Overall, Bankrate believes that, as of June 30, 2017, Barrington Bank & Trust Company, National Association exhibited a superior condition, earning a full 5 stars for safety and soundness. Here's an analysis of how the bank faired on the three key criteria Bankrate used to grade American banks on safety and soundness.

WHAT IS
SAFE AND SOUND?

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THE INSTITUTION'S SCORE

Capital Score

Capital works as a buffer against losses and provides protection for accountholders when a bank is struggling financially. It follows then that a bank's level of capital is an essential measurement of a bank's financial strength. When looking at safety and soundness, more capital is better.
On our test to measure the adequacy of a bank's capital, Barrington Bank & Trust Company, National Association received a score of 10 out of a possible 30 points, less than the national average of 13.38.

A bank's Tier 1 capital ratio is an essential measure of this buffer. Barrington Bank & Trust Company, National Association's Tier 1 capital ratio was 11.56 percent, exceeding the 6 percent level considered adequate by regulators, but under the national average of 25.16 percent. The higher the capital ratio, the better the bank will be able to stand up to financial difficulties.

Overall, Barrington Bank & Trust Company, National Association held equity amounting to 11.64 percent of its assets, which was lower than the national average of 12.10 percent.

Asset Quality Score

Bankrate uses this test to determine the effect of problem assets, such as past-due loans, on the bank's loan loss reserves and overall capitalization.

A bank with lots of these types of assets may eventually be required to use capital to absorb losses, cutting down on its buffer of equity. Many of those assets are also likely to be in non-accrual status and thus aren't earning money, decreasing earnings and increasing the risk of a future failure.

Barrington Bank & Trust Company, National Association scored 40 out of a possible 40 points on Bankrate's test of asset quality, beating out the national average of 37.62.

The percentage of problem assets a bank holds compared to its total assets is a useful indicator of asset quality.As of June 30, 2017, 0.23 percent of Barrington Bank & Trust Company, National Association's loans were noncurrent, meaning they were more than 90 days past due or were in non-accrual status. That's below the national average of 1.04 percent.

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

Earnings score

A bank's earnings performance has an effect on its safety and soundness. Earnings can be retained by the bank, giving a boost to its capital buffer, or be used to address problematic loans, likely making the bank better able to withstand financial trouble. Conversely, losses lessen a bank's ability to do those things.

Barrington Bank & Trust Company, National Association scored 22 out of a possible 30 on Bankrate's test of earnings, exceeding the national average of 16.52.

Return on equity, calculated by dividing net income (essentially, profit) by the total amount of equity, is one important way to measure a bank's earnings. The most recent annualized quarterly return on equity for Barrington Bank & Trust Company, National Association was 13.23 percent, above the national average of 9.28 percent.

The bank earned net income of $14.6 million on total equity of $228.2 million for the twelve months ended June 30, 2017. The bank experienced an annualized return on average assets, or ROA, of 1.52 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.