Safe and Sound

Jefferson Bank of Florida

Oldsmar, FL
4
Star Rating
Founded in 2007, Jefferson Bank of Florida is an FDIC-insured bank based in Oldsmar, FL. As of June 30, 2017, the bank had equity of $29.0 million on $316,542,000 in assets.

Thanks to the efforts of 48 full-time employees in 6 offices in FL, the bank holds loans and leases worth $241.2 million, including $220.7 million worth of real estate loans. The bank currently holds $238.1 million in deposits from U.S. customers.

Overall, Bankrate believes that, as of June 30, 2017, Jefferson Bank of Florida exhibited a good condition, earning 4 out of 5 stars for safety and soundness. Keep reading for a look at how the bank faired on the three key criteria Bankrate used to score American banks.

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THE INSTITUTION'S SCORE

Capital Score

Capital is a crucial measurement of an institution's financial resilience. It works as a buffer against losses and provides protection for depositors during times of economic trouble for the bank. When it comes to safety and soundness, more capital is better.
Jefferson Bank of Florida came in below the national average of 13.38 on our test to measure the adequacy of a bank's capital, achieving a score of 10 out of a possible 30 points.

One commonly used measure of this buffer is a bank's Tier 1 capital ratio. Jefferson Bank of Florida's Tier 1 capital ratio was 11.44 percent, exceeding the 6 percent level regulators consider adequate, but under the national average of 25.16 percent. The higher the capital ratio, the better the bank will be able to stand up to economic difficulties.

Overall, Jefferson Bank of Florida held equity amounting to 9.15 percent of its assets, which was lower than the national average of 12.10 percent.

Asset Quality Score

In this test, Bankrate tries to estimate the effect of troubled assets, such as past-due mortgages, on the bank's reserves set aside to cover loan losses, as well as overall capitalization.

Having large numbers of these kinds of assets could eventually require a bank to use capital to cover losses, shrinking its equity buffer. Many of those assets are also likely to be in non-accrual status and no longer earning interest for the bank, resulting in diminished earnings and potentially more risk of a future failure.

Jefferson Bank of Florida beat out the national average of 37.62 on Bankrate's asset quality test, racking up 40 out of a possible 40 points .

A handy indicator of asset quality is the percentage of problem assets a bank holds compared to its total assets. As of June 30, 2017, 0.38 percent of Jefferson Bank of Florida'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 1.04 percent.

Banks maintain a reserve known as an "allowance for loan and lease losses" to deal with problem assets . That reserve's size can be a handy indicator when evaluating a bank's ability to manage troubled assets, especially when compared to the total amount of problematic loans. Unfortunately, the FDIC did not provide information on Jefferson Bank of Florida's loan loss allowance in its most recent filings.

Earnings score

A bank's profitability affects its safety and soundness. Earnings can be retained by the bank, boosting its capital cushion, or be used to deal with problematic loans, potentially making the bank more resilient in times of trouble. Losses, on the other hand, take away from a bank's ability to do those things.

Jefferson Bank of Florida scored 18 out of a possible 30 on Bankrate's test of earnings, exceeding the national average of 16.52.

Return on equity, calculated by dividing net income (profit, essentially) by total equity, is one important measure of a bank's earnings. The most recent annualized quarterly return on equity for Jefferson Bank of Florida was 8.66 percent, below the national average of 9.28 percent.

For the twelve months ended June 30, 2017, the bank recorded net income of $1.2 million on total equity of $29.0 million. The bank experienced an annualized return on average assets, or ROA, of 0.80 percent, below the 1 percent deemed satisfactory in accordance with industry standards and below the average for U.S. banks of 1.14 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.