Safe and Sound

Citizens Community Federal National Association

Altoona, WI
3
Star Rating
Started in 2001, Citizens Community Federal National Association is an FDIC-insured bank headquartered in Altoona, WI. Regulatory filings show the bank having equity of $98.6 million on assets of $942.8 million, as of December 31, 2017.

With 205 full-time employees in 20 offices in multiple states, the bank holds loans and leases worth $727.2 million, including real estate loans of $526.9 million. U.S. bank customers currently have $746.8 million in deposits with the bank.

Overall, Bankrate believes that, as of December 31, 2017, Citizens Community Federal National Association exhibited a generally satisfactory condition, earning 3 out of 5 stars for safety and soundness. Keep reading for a breakdown of how the bank fared on the three major criteria Bankrate used to score American banks.

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THE INSTITUTION'S SCORE

Capital Score

Capital is an important measurement of a bank's financial strength. It works as a cushion against losses and affords protection for accountholders when a bank is struggling financially. When looking at safety and soundness, the more capital, the better.

Citizens Community Federal National Association came in below the national average of 13.13 on our test to measure capital adequacy, achieving a score of 8 out of a possible 30 points.

One widely followed measure of this buffer is a bank's Tier 1 capital ratio. Citizens Community Federal National Association's Tier 1 capital ratio was 12.47 percent, above the 6 percent level regulators consider adequate, but less than the national average of 25.65 percent. A higher capital ratio suggests the bank will be better able to weather economic challenges.

Overall, Citizens Community Federal National Association held equity amounting to 10.46 percent of its assets, which was lower than the national average of 12.03 percent.

Asset Quality Score

Bankrate uses this test to determine the effect of problem assets, such as past-due mortgages, on the bank's capitalization and allocated loan loss reserves.

A bank with large numbers of these kinds of assets could eventually be forced to use capital to absorb losses, decreasing its buffer of equity. It also means that there are likely to be many assets that are in non-accrual status and no longer earning money, diminishing earnings and increasing the chances of a future failure.

On Bankrate's test of asset quality, Citizens Community Federal National Association scored 32 out of a possible 40 points, below the national average of 37.49 points.

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, 0.97 percent of Citizens Community Federal National Association'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 keep a reserve to deal with problem assets known as an "allowance for loan and lease losses." The size of that reserve can be a helpful indicator when evaluating a bank's ability to manage troubled assets, especially when compared to the total amount of at-risk loans. Unfortunately, the FDIC did not provide information on Citizens Community Federal National Association's loan loss allowance in its most recent filings.

Earnings score

How profitable a bank is affects its long-term survivability. A bank can retain its earnings, expanding its capital cushion, or use them to deal with problematic loans, likely making the bank more resilient in tough times. Losses, on the other hand, take away from a bank's ability to do those things.

Citizens Community Federal National Association scored 10 out of a possible 30 on Bankrate's test of earnings, coming in below the national average of 15.12.

Return on equity, calculated by dividing net income (profit, essentially) by the total amount of equity, is one important way to measure a bank's earnings. The most recent annualized quarterly return on equity for Citizens Community Federal National Association was 5.73 percent, below the national average of 8.10 percent.

The bank reported net income of $4.7 million on total equity of $98.6 million for the twelve months ended December 31, 2017. The bank had an annualized return on average assets, or ROA, of 0.60 percent, below the 1 percent deemed satisfactory in accordance with industry standards and below 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.