Asset Quality Score
In this test, Bankrate tries to determine the impact of problem assets, such as unpaid mortgages, on the bank's loan loss reserves and overall capitalization.
Having lots of these kinds of assets suggests a bank may have to use capital to cover losses, diminishing its equity buffer. It also means that there are likely to be many assets that are in non-accrual status and thus aren't earning money, diminishing earnings and increasing the risk of a failure in the future.
On Bankrate's asset quality test, Exchange Bank and Trust Company, Natchitoches, Louisiana scored 36 out of a possible 40 points, falling short of the national average of 37.49 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, 2.03 percent of Exchange Bank and Trust Company, Natchitoches, Louisiana's loans were noncurrent -- in other words, 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 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 problem loans can be a handy indicator when evaluating a bank's ability to manage troubled assets. Unfortunately, the FDIC did not provide information on Exchange Bank and Trust Company, Natchitoches, Louisiana's loan loss allowance in its most recent filings.