Safe and Sound

North American Savings Bank, F.S.B.

Grandview, MO
5
Star Rating
Started in 1923, North American Savings Bank, F.S.B. is an FDIC-insured bank headquartered in Grandview, MO. The bank holds equity of $241.1 million on $2.00 billion in assets, according to December 31, 2017, regulatory filings.

With 468 full-time employees in 11 offices in MO, the bank currently holds loans and leases worth $1.67 billion, including real estate loans of $1.72 billion. U.S. bank customers currently have $1.30 billion in deposits with the bank.

Overall, Bankrate believes that, as of December 31, 2017, North American Savings Bank, F.S.B. exhibited a superior condition, earning a full 5 stars for safety and soundness. Here's an analysis of how the bank fared on the three major criteria Bankrate used to evaluate U.S. banks on safety and soundness.

WHAT IS
SAFE AND SOUND?

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THE INSTITUTION'S SCORE

Capital Score

When it comes to measuring an an institution's financial stability, capital is important. It acts as a cushion against losses and as protection for depositors when a bank is experiencing financial instability. From a safety and soundness perspective, the higher the capital, the better.

North American Savings Bank, F.S.B. did better than the national average of 13.13 points on our test to measure capital adequacy, receiving a score of 14 out of a possible 30 points.

One widely used measure of this buffer is a bank's Tier 1 capital ratio. North American Savings Bank, F.S.B.'s Tier 1 capital ratio was 15.08 percent, above the 6 percent level regulators consider adequate, but under the national average of 25.65 percent. A higher capital ratio suggests the bank will be better able to stand up to financial headwinds.

Overall, North American Savings Bank, F.S.B. held equity amounting to 12.08 percent of its assets, which exceeded the national average of 12.03 percent.

Asset Quality Score

This test's purpose is to try to understand how the bank's loan loss reserves and overall capitalization could be affected by problem assets, such as unpaid mortgages.

A bank with a large number of these kinds of assets may eventually be forced to use capital to absorb losses, diminishing its equity buffer. It also means that there are likely to be many assets that are in non-accrual status and no longer earning interest for the bank, resulting in reduced earnings and potentially more risk of a failure in the future.

North American Savings Bank, F.S.B. scored 40 out of a possible 40 points on Bankrate's test of asset quality, better than the national average of 37.49.

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, 1.23 percent of North American 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 above 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 . The size of that reserve can be a handy indicator when evaluating a bank's ability to manage problem assets, especially when compared to the total amount of problematic loans. Unfortunately, the FDIC did not provide information on North American 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, expanding its capital buffer, or be used to address problematic loans, likely making the bank more resilient in times of trouble. However, banks that are losing money have less ability to do those things.

North American Savings Bank, F.S.B. scored 20 out of a possible 30 on Bankrate's test of earnings, beating the national average of 15.12.

Return on equity, calculated by dividing net income (profit, essentially) by the total amount of equity, is one important measure of a bank's earnings. The most recent annualized quarterly return on equity for North American Savings Bank, F.S.B. was 11.44 percent, above the national average of 8.10 percent.

For the twelve months ended December 31, 2017, the bank reported net income of $26.5 million on total equity of $241.1 million. The bank had an annualized return on average assets, or ROA, of 1.34 percent, above the 1 percent deemed satisfactory in accordance with industry standards, and above 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.