Safe and Sound

American Pride Bank

Macon, GA
5
Star Rating
Founded in 2007, American Pride Bank is an FDIC-insured bank based in Macon, GA. The bank holds equity of $25.5 million on assets of $167.7 million, according to December 31, 2017, regulatory filings.

U.S. bank customers have $136.7 million on deposit at 4 offices in GA run by 34 full-time employees. With that footprint, the bank currently holds loans and leases worth $128.8 million, including $120.6 million worth of real estate loans.

Overall, Bankrate believes that, as of December 31, 2017, American Pride Bank exhibited a superior condition, earning a full 5 stars for safety and soundness. Here's an analysis of how the bank did on the three major criteria Bankrate used to evaluate American banks on safety and soundness.

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THE INSTITUTION'S SCORE

Capital Score

Capital acts as a buffer against losses and affords protection for account holders when a bank is experiencing financial instability. Therefore, a bank's level of capital is an important measurement of an institution's financial fortitude. When it comes to safety and soundness, the higher the capital, the better.

American Pride Bank scored above the national average of 13.13 points on our test to measure capital adequacy, racking up 20 out of a possible 30 points.

One way to measure this buffer is looking at a bank's Tier 1 capital ratio. American Pride Bank's Tier 1 capital ratio was 18.08 percent, exceeding the 6 percent level regulators consider adequate, but below the national average of 25.65 percent. The higher the capital ratio, the better the bank will be able to stand up to economic downturns.

Overall, American Pride Bank held equity amounting to 15.18 percent of its assets, which exceeded the national average of 12.03 percent.

Asset Quality Score

In this test, Bankrate tries to estimate the impact of troubled assets, such as past-due loans, on the bank's capitalization and allocated loan loss reserves.

A bank with a large number of these kinds of assets may eventually be required to use capital to cover losses, reducing its equity cushion. Many of those assets are also likely to be in non-accrual status and thus aren't earning money, pushing down earnings and increasing the risk of a future failure.

American Pride Bank scored above the national average of 37.49 on Bankrate's test of asset quality, racking up 40 out of a possible 40 points .

A helpful indicator of asset quality is the percentage of problem assets a bank holds compared to its total assets. As of December 31, 2017, none of American Pride 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 1.01 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 at-risk loans can be a helpful indicator when evaluating a bank's ability to manage troubled assets. Unfortunately, the FDIC did not provide information on American Pride Bank's loan loss allowance in its most recent filings.

Earnings score

A bank's profitability 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 able to withstand economic shocks. Losses, on the other hand, take away from a bank's ability to do those things.

American Pride Bank scored 20 out of a possible 30 on Bankrate's earnings test, better than the national average of 15.12.

One widely used measure of a bank's earnings is return on equity, calculated by dividing net income (profit, essentially) by total equity. American Pride Bank's most recent annualized quarterly return on equity was 10.49 percent, above the national average of 8.10 percent.

The bank reported net income of $2.6 million on total equity of $25.5 million for the twelve months ended December 31, 2017. The bank had an annualized return on average assets, or ROA, of 1.65 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.