Safe and Sound

Deutsche Bank Trust Company Delaware

Wilmington, DE
5
Star Rating
Wilmington, DE-based Deutsche Bank Trust Company Delaware is an FDIC-insured bank founded in 1985. The bank holds equity of $285.2 million on $316.0 million in assets, according to December 31, 2017, regulatory filings.

With 25 full-time employees, the bank currently holds loans and leases worth $236.3 million, including real estate loans of $1.2 million. U.S. bank customers currently have $16.1 million in deposits with the bank.

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

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THE INSTITUTION'S SCORE

Capital Score

When it comes to measuring an an institution's financial stability, capital is useful. It works as a bulwark against losses and affords protection for depositors when a bank is experiencing financial trouble. When it comes to safety and soundness, the higher the capital, the better.

Deutsche Bank Trust Company Delaware racked up 30 out of a possible 30 points on our test to measure the adequacy of a bank's capital, beating out the national average of 13.13.

A bank's Tier 1 capital ratio is an essential measure of this buffer. Deutsche Bank Trust Company Delaware's Tier 1 capital ratio was 120.61 percent, exceeding 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 stand up to economic headwinds.

Overall, Deutsche Bank Trust Company Delaware held equity amounting to 90.24 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 troubled assets, such as unpaid mortgages.

A bank with lots of these types of assets could eventually have to use capital to cover losses, reducing its buffer of equity. Many of those assets are also likely to be in non-accrual status and thus aren't earning interest for the bank, resulting in lower earnings and potentially more risk of a future failure.

Deutsche Bank Trust Company Delaware exceeded 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 handy indicator of asset quality.As of December 31, 2017, none of Deutsche Bank Trust Company Delaware'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 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 problematic loans can be a widely used indicator when evaluating a bank's ability to manage troubled assets. Unfortunately, the FDIC did not provide information on Deutsche Bank Trust Company Delaware's loan loss allowance in its most recent filings.

Earnings score

How profitable a bank is affects its long-term survivability. Earnings may be retained by the bank, increasing its capital buffer, or be used to deal with problematic loans, potentially making the bank more resilient in tough times. Banks that are losing money, however, are less able to do those things.

Deutsche Bank Trust Company Delaware scored 6 out of a possible 30 on Bankrate's test of earnings, failing to reach the national average of 15.12.

One widely used way to measure a bank's earnings is return on equity, or net income (essentially profit) divided by total equity. Deutsche Bank Trust Company Delaware's most recent annualized quarterly return on equity was 2.94 percent, below the national average of 8.10 percent.

For the twelve months ended December 31, 2017, the bank recorded net income of $8.5 million on total equity of $285.2 million. The bank experienced an annualized return on average assets, or ROA, of 2.71 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.