Safe and Sound

Deutsche Bank Trust Company Americas

New York, NY
5
Star Rating
Deutsche Bank Trust Company Americas is an FDIC-insured bank founded in 1903 and currently headquartered in New York, NY. As of December 31, 2017, the bank held equity of $9.06 billion on assets of $43.39 billion.

With 559 full-time employees in 4 offices in NY, the bank currently holds loans and leases worth $9.36 billion, including real estate loans of $5.43 billion. U.S. bank customers currently have $31.62 billion in deposits with the bank.

Overall, Bankrate believes that, as of December 31, 2017, Deutsche Bank Trust Company Americas 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 important criteria Bankrate used to grade U.S. banks on safety and soundness.

WHAT IS
SAFE AND SOUND?

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THE INSTITUTION'S SCORE

Capital Score

Capital works as a buffer against losses and provides protection for account holders when a bank is struggling financially. Therefore, a bank's level of capital is a crucial measurement of a bank's financial resilience. When it comes to safety and soundness, more capital is preferred.

Deutsche Bank Trust Company Americas exceeded the national average of 13.13 points on our test to measure the adequacy of a bank's capital, receiving a score of 30 out of a possible 30 points.

One way to measure this buffer is looking at a bank's Tier 1 capital ratio. Deutsche Bank Trust Company Americas's Tier 1 capital ratio was 92.24 percent, higher than the 6 percent level considered adequate by regulators, and above the national average of 25.65 percent. The higher the capital ratio, the better the bank will be able to weather economic challenges.

Overall, Deutsche Bank Trust Company Americas held equity amounting to 20.88 percent of its assets, which exceeded the national average of 12.03 percent.

Asset Quality Score

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

A bank with large numbers of these kinds of assets may eventually have to use capital to absorb losses, cutting down on its equity buffer. Many of those assets are also likely to be in non-accrual status and thus aren't earning interest for the bank, pushing down earnings and elevating the chances of a failure in the future.

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

The percentage of problem assets a bank holds compared to its total assets is a useful indicator of asset quality.As of December 31, 2017, 0.57 percent of Deutsche Bank Trust Company Americas's loans were noncurrent -- in other words, 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 handle problem assets known as an "allowance for loan and lease losses." Comparing the reserve's size to the total amount of at-risk loans can be a widely used indicator when evaluating a bank's ability to manage problem assets. Unfortunately, the FDIC did not provide information on Deutsche Bank Trust Company Americas's loan loss allowance in its most recent filings.

Earnings score

How profitable a bank is affects its safety and soundness. A bank can retain its earnings, expanding its capital buffer, or use them to deal with problematic loans, potentially making the bank better prepared to withstand economic shocks. However, banks that are losing money are less able to do those things.

On Bankrate's earnings test, Deutsche Bank Trust Company Americas scored 4 out of a possible 30, lower 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 the total amount of equity. The most recent annualized quarterly return on equity for Deutsche Bank Trust Company Americas was 1.92 percent, below the national average of 8.10 percent.

The bank earned net income of $175.0 million on total equity of $9.06 billion for the twelve months ended December 31, 2017. The bank experienced an annualized return on average assets, or ROA, of 0.37 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.