Safe and Sound

Community Bank of Pickens County

Jasper, GA
2
Star Rating
Started in 2000, Community Bank of Pickens County is an FDIC-insured bank headquartered in Jasper, GA. Regulatory filings show the bank having equity of $33.1 million on assets of $330.8 million, as of June 30, 2017.

Thanks to the work of 55 full-time employees in 2 offices in GA, the bank currently holds loans and leases worth $245.7 million, $222.1 million of which are for real estate. The bank currently holds $292.8 million in deposits from U.S. customers.

Overall, Bankrate believes that, as of June 30, 2017, Community Bank of Pickens County exhibited a below-average condition, earning 2 out of 5 stars for safety and soundness. Keep reading for a breakdown of how the bank faired on the three important criteria Bankrate used to grade American banks.

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THE INSTITUTION'S SCORE

Capital Score

Capital is a crucial measurement of an institution's financial strength. It acts as a bulwark against losses and affords protection for depositors when a bank is experiencing economic instability. When it comes to safety and soundness, more capital is better.
Community Bank of Pickens County fell short of the national average of 13.38 on our test to measure capital adequacy, scoring 12 out of a possible 30 points.

One widely followed measure of this buffer is a bank's Tier 1 capital ratio. Community Bank of Pickens County's Tier 1 capital ratio was 13.40 percent, higher than 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 economic downturns.

Overall, Community Bank of Pickens County held equity amounting to 10.02 percent of its assets, which was lower than the national average of 12.10 percent.

Asset Quality Score

Bankrate uses this test to estimate the impact of problem assets, such as past-due mortgages, on the bank's capitalization and allocated loan loss reserves.

Having large numbers of these types of assets means a bank may have to use capital to cover losses, cutting down on its buffer of equity. Many of those assets are also likely to be in non-accrual status and no longer earning interest for the bank, pushing down earnings and elevating the risk of a failure in the future.

Community Bank of Pickens County scored 12 out of a possible 40 points on Bankrate's asset quality test, coming in below 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, 1.91 percent of Community Bank of Pickens County's loans were noncurrent -- in other words, 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 the size of that reserve to the total amount of problem loans can be a handy indicator when evaluating a bank's ability to manage troubled assets. Unfortunately, the FDIC did not provide information on Community Bank of Pickens County's loan loss allowance in its most recent filings.

Earnings score

A bank's profitability affects its safety and soundness. A bank can retain its earnings, giving a boost to its capital buffer, or put them to work addressing problematic loans, likely making the bank better able to withstand financial trouble. Conversely, losses take away from a bank's ability to do those things.

On Bankrate's test of earnings, Community Bank of Pickens County scored 18 out of a possible 30, beating the national average of 16.52.

Return on equity, calculated by dividing net income (profit, essentially) by total equity, is one important way to measure a bank's earnings. Community Bank of Pickens County's most recent annualized quarterly return on equity was 10.11 percent, above the national average of 9.28 percent.

The bank earned net income of $1.6 million on total equity of $33.1 million for the twelve months ended June 30, 2017. The bank experienced an annualized return on average assets, or ROA, of 0.99 percent, below the 1 percent deemed satisfactory in accordance with industry standards and below 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.