Safe and Sound

Meredith Village Savings Bank

Meredith, NH
4
Star Rating
Meredith, NH-based Meredith Village Savings Bank is an FDIC-insured bank founded in 1869. Regulatory filings show the bank having equity of $94.3 million on $887,696,000 in assets, as of June 30, 2017.

With 181 full-time employees in 15 offices in NH, the bank holds loans and leases worth $743.9 million, including real estate loans of $659.4 million. U.S. bank customers currently have $664.0 million in deposits with the bank.

Overall, Bankrate believes that, as of June 30, 2017, Meredith Village Savings Bank exhibited a good condition, earning 4 out of 5 stars for safety and soundness. Keep reading for a look at how the bank faired on the three key criteria Bankrate used to evaluate U.S. banks.

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THE INSTITUTION'S SCORE

Capital Score

When it comes to measuring an a bank's financial stability, capital is useful. It works as a cushion against losses and affords protection for depositors during times of economic trouble for the bank. From a safety and soundness perspective, more capital is preferred.
On our test to measure the adequacy of a bank's capital, Meredith Village Savings Bank received a score of 12 out of a possible 30 points, less than the national average of 13.38.

One widely used measure of this buffer is a bank's Tier 1 capital ratio. Meredith Village Savings Bank's Tier 1 capital ratio was 16.20 percent, higher than the 6 percent level regulators consider adequate, but below the national average of 25.16 percent. A higher capital ratio suggests the bank will be better able to stand up to economic headwinds.

Overall, Meredith Village Savings Bank held equity amounting to 10.62 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 effect of troubled assets, such as past-due mortgages, on the bank's reserves set aside to cover loan losses, as well as overall capitalization.

A bank with a large number of these kinds of assets could eventually be forced to use capital to absorb losses, shrinking its cushion of equity. Many of those assets are also likely to be in non-accrual status and thus aren't earning interest for the bank, resulting in reduced earnings and potentially more risk of a future failure.

Meredith Village Savings Bank exceeded the national average of 37.62 on Bankrate's asset quality test, racking up 40 out of a possible 40 points .

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, 0.45 percent of Meredith Village Savings Bank'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 maintain a reserve to handle troubled assets known as an "allowance for loan and lease losses." 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 Meredith Village Savings Bank's loan loss allowance in its most recent filings.

Earnings score

A bank's earnings performance has an effect on its long-term survivability. Earnings can be retained by the bank, expanding its capital buffer, or be used to deal with problematic loans, potentially making the bank better able to withstand economic trouble. Obviously, banks that are losing money have less ability to do those things.

On Bankrate's test of earnings, Meredith Village Savings Bank scored 16 out of a possible 30, falling short of the national average of 16.52.

Return on equity, calculated by dividing net income (profit, basically) by the total amount of equity, is one key measure of a bank's earnings. Meredith Village Savings Bank's most recent annualized quarterly return on equity was 8.13 percent, below the national average of 9.28 percent.

For the twelve months ended June 30, 2017, the bank earned net income of $3.8 million on total equity of $94.3 million. The bank experienced an annualized return on average assets, or ROA, of 0.88 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.