Safe and Sound

First National Bank of Pulaski

Pulaski, TN
4
Star Rating
Pulaski, TN-based First National Bank of Pulaski is an FDIC-insured bank started in 1938. As of December 31, 2017, the bank had equity of $81.9 million on assets of $814.1 million.

With 172 full-time employees in 12 offices in multiple states, the bank holds loans and leases worth $484.9 million, including real estate loans of $390.7 million. U.S. bank customers currently have $721.1 million in deposits with the bank.

Overall, Bankrate believes that, as of December 31, 2017, First National Bank of Pulaski exhibited a good condition, earning 4 out of 5 stars for safety and soundness. Keep reading for a breakdown of how the bank fared on the three important criteria Bankrate used to grade American banks.

WHAT IS
SAFE AND SOUND?

Find out

THE INSTITUTION'S SCORE

Capital Score

When it comes to measuring an a bank's financial stability, capital is useful. It acts as a buffer against losses and as protection for accountholders when a bank is experiencing financial trouble. When looking at safety and soundness, the higher the capital, the better.

First National Bank of Pulaski scored below the national average of 13.13 on our test to measure capital adequacy, scoring 12 out of a possible 30 points.

One widely followed measure of this buffer is a bank's Tier 1 capital ratio. First National Bank of Pulaski's Tier 1 capital ratio was 14.38 percent, higher than the 6 percent level considered adequate by regulators, but below 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, First National Bank of Pulaski held equity amounting to 10.06 percent of its assets, which was lower than the national average of 12.03 percent.

Asset Quality Score

This test is intended to estimate 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 a large number of these types of assets may eventually be required to use capital to cover losses, decreasing its cushion of equity. Many of those assets are also likely to be in non-accrual status and no longer earning money, reducing earnings and elevating the risk of a failure in the future.

First National Bank of Pulaski scored below the national average of 37.49 on Bankrate's test of asset quality, racking up 36 out of a possible 40 points .

The percentage of problem assets a bank holds compared to its total assets is a widely used indicator of asset quality.As of December 31, 2017, 0.65 percent of First National Bank of Pulaski'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 handle troubled assets known as an "allowance for loan and lease losses." How large that reserve is can be a widely used indicator when evaluating a bank's ability to manage troubled assets, especially when compared to the total amount of problem loans. Unfortunately, the FDIC did not provide information on First National Bank of Pulaski's loan loss allowance in its most recent filings.

Earnings score

How profitable a bank is affects its long-term survivability. Earnings can 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. Conversely, losses reduce a bank's ability to do those things.

First National Bank of Pulaski received above-average marks on Bankrate's earnings test, achieving a score of 18 out of a possible 30.

One key way to measure 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 First National Bank of Pulaski was 8.49 percent, above the national average of 8.10 percent.

For the twelve months ended December 31, 2017, the bank recorded net income of $6.9 million on total equity of $81.9 million. The bank experienced an annualized return on average assets, or ROA, of 0.87 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.