Safe and Sound

Hancock County Savings Bank, F.S.B.

Chester, WV
5
Star Rating
Chester, WV-based Hancock County Savings Bank, F.S.B. is an FDIC-insured bank started in 1899. Regulatory filings show the bank having equity of $63.7 million on $360.2 million in assets, as of December 31, 2017.

Thanks to the efforts of 72 full-time employees in 3 offices in WV, the bank has amassed loans and leases worth $282.2 million, including $276.7 million worth of real estate loans. The bank currently holds $275.4 million in deposits from U.S. customers.

Overall, Bankrate believes that, as of December 31, 2017, Hancock County Savings Bank, F.S.B. exhibited a superior condition, earning a full 5 stars for safety and soundness. Here's a breakdown of how the bank did on the three major criteria Bankrate used to grade American banks on safety and soundness.

WHAT IS
SAFE AND SOUND?

Find out

THE INSTITUTION'S SCORE

Capital Score

When it comes to measuring an a bank's financial strength, capital is valuable. It acts as a buffer against losses and provides protection for accountholders during periods of financial trouble for the bank. From a safety and soundness perspective, more capital is preferred.

On our test to measure the adequacy of a bank's capital, Hancock County Savings Bank, F.S.B. scored 26 out of a possible 30 points, above the national average of 13.13.

A bank's Tier 1 capital ratio is an important measure of this buffer. Hancock County Savings Bank, F.S.B.'s Tier 1 capital ratio was 33.58 percent, higher than the 6 percent level considered adequate by regulators, and exceeding the national average of 25.65 percent. A higher capital ratio means the bank will be better able to weather economic challenges.

Overall, Hancock County Savings Bank, F.S.B. held equity amounting to 17.69 percent of its assets, which exceeded 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 past-due mortgages.

Having lots of these types of assets could eventually force a bank to use capital to absorb losses, reducing its cushion of equity. Many of those assets are also likely to be in non-accrual status and no longer earning interest for the bank, pushing down earnings and elevating the risk of a future failure.

Hancock County Savings Bank, F.S.B. beat out the national average of 37.49 on Bankrate's test of asset quality, racking up 40 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, 0.79 percent of Hancock County Savings Bank, F.S.B.'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 known as an "allowance for loan and lease losses" to deal with problem assets . Comparing the reserve's size to the total amount of problem loans can be a helpful indicator when evaluating a bank's ability to manage problem assets. Unfortunately, the FDIC did not provide information on Hancock County Savings Bank, F.S.B.'s loan loss allowance in its most recent filings.

Earnings score

How profitable a bank is affects its safety and soundness. Earnings may be retained by the bank, boosting its capital buffer, or be used to address problematic loans, potentially making the bank more resilient in times of trouble. Losses, on the other hand, lessen a bank's ability to do those things.

Hancock County Savings Bank, F.S.B. scored 8 out of a possible 30 on Bankrate's test of earnings, failing to reach the national average of 15.12.

Return on equity, calculated by dividing net income (essentially, profit) by total equity, is one important way to measure a bank's earnings. The most recent annualized quarterly return on equity for Hancock County Savings Bank, F.S.B. was 4.01 percent, below the national average of 8.10 percent.

The bank recorded net income of $2.5 million on total equity of $63.7 million for the twelve months ended December 31, 2017. The bank reported an annualized return on average assets, or ROA, of 0.70 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.