Safe and Sound

Eagle Savings Bank

Cincinnati, OH
5
Star Rating
Started in 1882, Eagle Savings Bank is an FDIC-insured bank headquartered in Cincinnati, OH. As of December 31, 2017, the bank had equity of $20.2 million on assets of $131.0 million.

U.S. bank customers have $107.8 million on deposit at 3 offices in OH run by 28 full-time employees. With that footprint, the bank holds loans and leases worth $99.9 million, $96.1 million of which are for real estate.

Overall, Bankrate believes that, as of December 31, 2017, Eagle Savings Bank 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 major criteria Bankrate used to grade American banks on safety and soundness.

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THE INSTITUTION'S SCORE

Capital Score

Capital is a valuable measurement of a bank's financial resilience. It works as a buffer against losses and as protection for accountholders during times of economic trouble for the bank. When looking at safety and soundness, more capital is better.

Eagle Savings Bank scored 22 out of a possible 30 points on our test to measure capital adequacy, beating out the national average of 13.13.

One widely used measure of this buffer is a bank's Tier 1 capital ratio. Eagle Savings Bank's Tier 1 capital ratio was 17.01 percent, exceeding the 6 percent level considered adequate by regulators, but lower than the national average of 25.65 percent. A higher capital ratio means the bank will be better able to weather economic downturns.

Overall, Eagle Savings Bank held equity amounting to 15.41 percent of its assets, which exceeded the national average of 12.03 percent.

Asset Quality Score

Bankrate uses this test to determine the effect of troubled assets, such as unpaid loans, on the bank's reserves set aside to cover loan losses, as well as overall capitalization.

A bank with a large number of these kinds of assets could eventually be required to use capital to absorb losses, shrinking its cushion of equity. 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 chances of a failure in the future.

Eagle Savings 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 useful indicator of asset quality is the percentage of problem assets a bank holds compared to its total assets. As of December 31, 2017, 0.78 percent of Eagle Savings Bank'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 maintain a reserve to deal with problem assets known as an "allowance for loan and lease losses." The size of that reserve can be a handy 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 Eagle Savings Bank's loan loss allowance in its most recent filings.

Earnings score

A bank's earnings performance has an effect on its long-term survivability. Earnings may be retained by the bank, boosting its capital cushion, or be used to deal with problematic loans, likely making the bank more resilient in tough times. Conversely, losses reduce a bank's ability to do those things.

Eagle Savings Bank fell behind the national average on Bankrate's test of earnings, achieving a score of 8 out of a possible 30.

One important measure of a bank's earnings is return on equity, or net income (essentially profit) divided by total equity. Eagle Savings Bank's most recent annualized quarterly return on equity was 4.64 percent, below the national average of 8.10 percent.

The bank reported net income of $752,000 on total equity of $20.2 million for the twelve months ended December 31, 2017. The bank experienced 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.