Safe and Sound

First National Bank in Tigerton

Tigerton, WI
4
Star Rating
First National Bank in Tigerton is an FDIC-insured bank started in 1934 and currently based in Tigerton, WI. The bank has equity of $3.3 million on assets of $23.7 million, according to December 31, 2017, regulatory filings.

U.S. bank customers have $20.4 million on deposit at 2 offices in WI run by 8 full-time employees. With that footprint, the bank currently holds loans and leases worth $11.0 million, $10.0 million of which are for real estate.

Overall, Bankrate believes that, as of December 31, 2017, First National Bank in Tigerton exhibited a good condition, earning 4 out of 5 stars for safety and soundness. Keep reading for a look at how the bank fared on the three key criteria Bankrate used to evaluate U.S. banks.

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THE INSTITUTION'S SCORE

Capital Score

Capital is a useful measurement of an institution's financial fortitude. It acts as a cushion against losses and as protection for depositors during periods of financial instability for the bank. When it comes to safety and soundness, the more capital, the better.

First National Bank in Tigerton beat out the national average of 13.13 points on our test to measure capital adequacy, achieving a score of 18 out of a possible 30 points.

A bank's Tier 1 capital ratio is an important measure of this buffer. First National Bank in Tigerton's Tier 1 capital ratio was 41.12 percent, exceeding the 6 percent level regulators consider adequate, and above the national average of 25.65 percent. A higher capital ratio means the bank will be better able to stand up to financial difficulties.

Overall, First National Bank in Tigerton held equity amounting to 13.94 percent of its assets, which exceeded the national average of 12.03 percent.

Asset Quality Score

In this test, Bankrate tries to determine the impact of problem assets, such as unpaid loans, on the bank's capitalization and allocated loan loss reserves.

A bank with a large number of these kinds of assets may eventually have to use capital to cover losses, shrinking 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 interest for the bank, diminishing earnings and elevating the risk of a failure in the future.

On Bankrate's test of asset quality, First National Bank in Tigerton scored 40 out of a possible 40 points, exceeding the national average of 37.49 points.

A helpful indicator of asset quality is the percentage of problem assets a bank holds compared to its total assets. As of December 31, 2017, none of First National Bank in Tigerton's loans were noncurrent, meaning 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 troubled assets known as an "allowance for loan and lease losses." The size of that reserve can be a widely used indicator when evaluating a bank's ability to manage problem assets, especially when compared to the total amount of at-risk loans. Unfortunately, the FDIC did not provide information on First National Bank in Tigerton's loan loss allowance in its most recent filings.

Earnings score

A bank's ability to earn money has an effect on its safety and soundness. Earnings may be retained by the bank, giving a boost to its capital cushion, or be used to deal with problematic loans, likely making the bank more resilient in tough times. Obviously, banks that are losing money are less able to do those things.

First National Bank in Tigerton scored 4 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, calculated by dividing net income (profit, essentially) by total equity. The most recent annualized quarterly return on equity for First National Bank in Tigerton was 1.89 percent, below the national average of 8.10 percent.

The bank recorded net income of $62,000 on total equity of $3.3 million for the twelve months ended December 31, 2017. The bank reported an annualized return on average assets, or ROA, of 0.27 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.