Safe and Sound

Manasquan Bank

Manasquan, NJ
4
Star Rating
Started in 1874, Manasquan Bank is an FDIC-insured bank headquartered in Manasquan, NJ. Regulatory filings show the bank having equity of $114.0 million on assets of $1.18 billion, as of June 30, 2017.

With 136 full-time employees in 9 offices in NJ, the bank holds loans and leases worth $980.7 million, including real estate loans of $894.4 million. U.S. bank customers currently have $1.04 billion in deposits with the bank.

Overall, Bankrate believes that, as of June 30, 2017, Manasquan 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 key criteria Bankrate used to grade American banks.

WHAT IS
SAFE AND SOUND?

Find out

THE INSTITUTION'S SCORE

Capital Score

Capital is a crucial measurement of an institution's financial strength. It works as a bulwark against losses and provides protection for accountholders during times of financial instability for the bank. When looking at safety and soundness, the more capital, the better.
Manasquan Bank finished below the national average of 13.38 on our test to measure the adequacy of a bank's capital, scoring 10 out of a possible 30 points.

One commonly used measure of this buffer is a bank's Tier 1 capital ratio. Manasquan Bank's Tier 1 capital ratio was 12.30 percent, exceeding the 6 percent level considered adequate by regulators, but below the national average of 25.16 percent. A higher capital ratio suggests the bank will be better able to stand up to financial downturns.

Overall, Manasquan Bank held equity amounting to 9.67 percent of its assets, which was lower than the national average of 12.10 percent.

Asset Quality Score

This test's purpose is to try to understand how the bank's reserves set aside to cover loan losses, as well as overall capitalization could be affected by troubled assets, such as past-due mortgages.

Having lots of these kinds of assets means a bank could have to use capital to absorb losses, shrinking its cushion of equity. It also means that there are likely to be many assets that are in non-accrual status and thus aren't earning interest for the bank, resulting in lower earnings and potentially more risk of a future failure.

On Bankrate's test of asset quality, Manasquan Bank scored 40 out of a possible 40 points, above the national average of 37.62 points.

The percentage of problem assets a bank holds compared to its total assets is a handy indicator of asset quality.As of June 30, 2017, 0.34 percent of Manasquan Bank's loans were noncurrent -- in other words, 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 maintain a reserve known as an "allowance for loan and lease losses" to deal with troubled 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 problem assets. Unfortunately, the FDIC did not provide information on Manasquan Bank's loan loss allowance in its most recent filings.

Earnings score

How profitable a bank is affects its safety and soundness. Earnings can be retained by the bank, increasing its capital cushion, or be used to address problematic loans, potentially making the bank better prepared to withstand financial shocks. Losses, on the other hand, diminish a bank's ability to do those things.

Manasquan Bank fell behind the national average on Bankrate's earnings test, achieving a score of 14 out of a possible 30.

Return on equity, calculated by dividing net income (profit, basically) by total equity, is one important measure of a bank's earnings. Manasquan Bank's most recent annualized quarterly return on equity was 6.89 percent, below the national average of 9.28 percent.

The bank recorded net income of $3.9 million on total equity of $114.0 million for the twelve months ended June 30, 2017. The bank experienced an annualized return on average assets, or ROA, of 0.67 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.