Safe and Sound

City Savings Bank & Trust Company

Deridder, LA
5
Star Rating
Founded in 1928, City Savings Bank & Trust Company is an FDIC-insured bank headquartered in Deridder, LA. The bank holds equity of $34.1 million on $326.1 million in assets, according to December 31, 2017, regulatory filings.

U.S. bank customers have $291.1 million on deposit at 9 offices in LA run by 111 full-time employees. With that footprint, the bank currently holds loans and leases worth $259.4 million, including real estate loans of $208.0 million.

Overall, Bankrate believes that, as of December 31, 2017, City Savings Bank & 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 key criteria Bankrate used to evaluate U.S. banks on safety and soundness.

WHAT IS
SAFE AND SOUND?

Find out

THE INSTITUTION'S SCORE

Capital Score

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

On our test to measure capital adequacy, City Savings Bank & Trust Company received a score of 12 out of a possible 30 points, failing to reach the national average of 13.13.

One widely followed measure of this buffer is a bank's Tier 1 capital ratio. City Savings Bank & Trust Company's Tier 1 capital ratio was 14.39 percent, above the 6 percent level considered adequate by regulators, but less than the national average of 25.65 percent. A higher capital ratio suggests the bank will be better able to stand up to financial headwinds.

Overall, City Savings Bank & Trust Company held equity amounting to 10.46 percent of its assets, which was lower than the national average of 12.03 percent.

Asset Quality Score

This test is intended to try to understand how the bank's reserves set aside to cover loan losses, as well as overall capitalization, could be affected by troubled assets, such as unpaid loans.

A bank with large numbers of these kinds of assets may eventually be required to use capital to cover 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, reducing earnings and elevating the risk of a future failure.

On Bankrate's test of asset quality, City Savings Bank & Trust Company scored 36 out of a possible 40 points, failing to reach the national average of 37.49 points.

The percentage of problem assets a bank holds compared to its total assets is a helpful indicator of asset quality.As of December 31, 2017, 1.56 percent of City Savings Bank & Trust Company's loans were noncurrent, meaning 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 troubled assets . That reserve's size can be a handy indicator when evaluating a bank's ability to manage problem assets, especially when compared to the total amount of problem loans. Unfortunately, the FDIC did not provide information on City Savings Bank & Trust Company'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, boosting its capital buffer, or put them to work addressing problematic loans, likely making the bank better able to withstand financial trouble. Conversely, losses take away from a bank's ability to do those things.

On Bankrate's earnings test, City Savings Bank & Trust Company scored 28 out of a possible 30, above the national average of 15.12.

Return on equity, calculated by dividing net income (profit, essentially) by total equity, is one important way to measure a bank's earnings. The most recent annualized quarterly return on equity for City Savings Bank & Trust Company was 18.84 percent, above the national average of 8.10 percent.

For the twelve months ended December 31, 2017, the bank earned net income of $6.2 million on total equity of $34.1 million. The bank had an annualized return on average assets, or ROA, of 1.91 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.