Safe and Sound

San Diego Private Bank

Coronado, CA
5
Star Rating
San Diego Private Bank is an FDIC-insured bank started in 2006 and currently headquartered in Coronado, CA. As of June 30, 2017, the bank held equity of $83.6 million on $564,891,000 in assets.

U.S. bank customers have $394.0 million on deposit at 4 offices in CA run by 76 full-time employees. With that footprint, the bank has amassed loans and leases worth $449.0 million, $363.2 million of which are for real estate.

Overall, Bankrate believes that, as of June 30, 2017, San Diego Private Bank exhibited a superior condition, earning a full 5 stars for safety and soundness. Keep reading for an analysis of how the bank faired on the three important criteria Bankrate used to grade U.S. banks on safety and soundness.

WHAT IS
SAFE AND SOUND?

Find out

THE INSTITUTION'S SCORE

Capital Score

Capital works as a cushion against losses and provides protection for accountholders when a bank is experiencing economic trouble. It follows then that when it comes to measuring an a bank's financial stability, capital is useful. From a safety and soundness perspective, the higher the capital, the better.
On our test to measure capital adequacy, San Diego Private Bank scored 20 out of a possible 30 points, beating the national average of 13.38.

One way to measure this buffer is looking at a bank's Tier 1 capital ratio. San Diego Private Bank's Tier 1 capital ratio was 16.81 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 weather financial challenges.

Overall, San Diego Private Bank held equity amounting to 14.80 percent of its assets, which exceeded the national average of 12.10 percent.

Asset Quality Score

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

A bank with large numbers of these types of assets may eventually be forced to use capital to absorb losses, reducing its buffer of equity. Many of those assets are also likely to be in non-accrual status and thus aren't earning money, resulting in lower earnings and potentially more risk of a failure in the future.

San Diego Private Bank scored above the national average of 37.62 on Bankrate's asset quality test, racking up 40 out of a possible 40 points .

A widely used indicator of asset quality is the percentage of problem assets a bank holds compared to its total assets. As of June 30, 2017, 0.03 percent of San Diego Private 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 keep a reserve known as an "allowance for loan and lease losses" to deal with problem assets . The size of that reserve can be a handy indicator when evaluating a bank's ability to manage problem assets, especially when compared to the total amount of problematic loans. San Diego Private Bank's loan loss allowance was 3,024.46 percent of its total noncurrent loans, above the national average. All else being equal, the higher the ratio of loan loss allowance to noncurrent loans, the better.

Earnings score

How profitable a bank is affects its safety and soundness. A bank can retain its earnings, giving a boost to its capital cushion, or put them to work addressing problematic loans, likely making the bank better prepared to withstand financial shocks. Conversely, losses lessen a bank's ability to do those things.

San Diego Private Bank scored 14 out of a possible 30 on Bankrate's earnings test, falling short of the national average of 16.52.

Return on equity, calculated by dividing net income (profit, essentially) by the total amount of equity, is one widely used measure of a bank's earnings. The most recent annualized quarterly return on equity for San Diego Private Bank was 7.38 percent, below the national average of 9.28 percent.

The bank earned net income of $2.6 million on total equity of $83.6 million for the twelve months ended June 30, 2017. The bank experienced an annualized return on average assets, or ROA, of 0.94 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.