Safe and Sound

Altamaha Bank and Trust Company

Vidalia, GA
5
Star Rating
Vidalia, GA-based Altamaha Bank and Trust Company is an FDIC-insured bank founded in 1966. Regulatory filings show the bank having equity of $18.1 million on assets of $167.8 million, as of December 31, 2017.

With 53 full-time employees in 4 offices in GA, the bank has amassed loans and leases worth $108.3 million, including real estate loans of $87.2 million. U.S. bank customers currently have $149.4 million in deposits with the bank.

Overall, Bankrate believes that, as of December 31, 2017, Altamaha Bank and Trust Company exhibited a superior condition, earning a full 5 stars for safety and soundness. Here's a look at how the bank fared on the three major criteria Bankrate used to score U.S. banks on safety and soundness.

WHAT IS
SAFE AND SOUND?

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THE INSTITUTION'S SCORE

Capital Score

Capital acts as a buffer against losses and provides protection for account holders when a bank is struggling financially. It follows then that when it comes to measuring an a bank's financial strength, capital is crucial. When looking at safety and soundness, more capital is better.

Altamaha Bank and Trust Company scored below the national average of 13.13 on our test to measure capital adequacy, scoring 12 out of a possible 30 points.

One way to measure this buffer is looking at a bank's Tier 1 capital ratio. Altamaha Bank and Trust Company's Tier 1 capital ratio was 16.84 percent, above the 6 percent level considered adequate by regulators, but lower than the national average of 25.65 percent. A higher capital ratio means the bank will be better able to weather economic headwinds.

Overall, Altamaha Bank and Trust Company held equity amounting to 10.80 percent of its assets, which was lower than the national average of 12.03 percent.

Asset Quality Score

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

A bank with extensive holdings of these kinds of assets may eventually be forced to use capital to cover losses, decreasing its buffer of equity. Many of those assets are also likely to be in non-accrual status and no longer earning money, diminishing earnings and increasing the chances of a failure in the future.

Altamaha Bank and Trust Company scored 36 out of a possible 40 points on Bankrate's test of asset quality, lower than the national average of 37.49.

A widely used indicator of asset quality is the percentage of problem assets a bank holds compared to its total assets. As of December 31, 2017, 1.99 percent of Altamaha Bank and Trust Company'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 1.01 percent.

Banks maintain a reserve known as an "allowance for loan and lease losses" to deal with problem assets . Comparing the size of that reserve to the total amount of problem loans can be a useful indicator when evaluating a bank's ability to manage troubled assets. Unfortunately, the FDIC did not provide information on Altamaha Bank and Trust Company's loan loss allowance in its most recent filings.

Earnings score

A bank's earnings performance affects its long-term survivability. A bank can retain its earnings, increasing its capital buffer, or use them to address problematic loans, potentially making the bank better able to withstand economic shocks. However, banks that are losing money are less able to do those things.

Altamaha Bank and Trust Company exceeded the national average on Bankrate's test of earnings, achieving a score of 22 out of a possible 30.

One widely used measure of a bank's earnings is return on equity, calculated by dividing net income (profit, basically) by total equity. The most recent annualized quarterly return on equity for Altamaha Bank and Trust Company was 12.91 percent, above the national average of 8.10 percent.

For the twelve months ended December 31, 2017, the bank earned net income of $2.3 million on total equity of $18.1 million. The bank reported an annualized return on average assets, or ROA, of 1.40 percent, above the 1 percent deemed satisfactory in accordance with industry standards, and above the average for U.S. banks of 1.00 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.