Safe and Sound

Raymond James Bank, National Association

Saint Petersburg, FL
5
Star Rating
Started in 1994, Raymond James Bank, National Association is an FDIC-insured bank based in Saint Petersburg, FL. As of December 31, 2017, the bank held equity of $1.82 billion on assets of $21.87 billion.

Thanks to the efforts of 225 full-time employees, the bank has amassed loans and leases worth $17.70 billion, $5.90 billion of which are for real estate. U.S. bank customers currently have $18.97 billion in deposits with the bank.

Overall, Bankrate believes that, as of December 31, 2017, Raymond James Bank, National Association 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 score American banks on safety and soundness.

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THE INSTITUTION'S SCORE

Capital Score

Capital is an essential measurement of a bank's financial resilience. It acts as a bulwark against losses and affords protection for depositors during times of financial trouble for the bank. When it comes to safety and soundness, more capital is preferred.

Raymond James Bank, National Association received a score of 8 out of a possible 30 points on our test to measure the adequacy of a bank's capital, falling short of the national average of 13.19.

One way to measure this buffer is looking at a bank's Tier 1 capital ratio. Raymond James Bank, National Association's Tier 1 capital ratio was 12.18 percent, above the 6 percent level regulators consider adequate, but below the national average of 25.67 percent. The higher the capital ratio, the better the bank will be able to weather financial challenges.

Overall, Raymond James Bank, National Association held equity amounting to 8.33 percent of its assets, which was lower than the national average of 12.04 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 troubled assets, such as unpaid loans.

A bank with lots of these kinds of assets may eventually be required to use capital to absorb losses, reducing its cushion of equity. 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, resulting in lower earnings and potentially more risk of a future failure.

Raymond James Bank, National Association beat out the national average of 37.70 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 handy indicator of asset quality.As of December 31, 2017, 0.21 percent of Raymond James Bank, National Association'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 1.14 percent.

Banks maintain a reserve known as an "allowance for loan and lease losses" to deal with troubled 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 at-risk loans. Unfortunately, the FDIC did not provide information on Raymond James Bank, National Association's loan loss allowance in its most recent filings.

Earnings score

How profitable a bank is affects its safety and soundness. A bank can retain its earnings, increasing its capital buffer, or put them to work addressing problematic loans, potentially making the bank more resilient in times of trouble. Banks that are losing money, however, have less ability to do those things.

Raymond James Bank, National Association beat the national average on Bankrate's earnings test, achieving a score of 24 out of a possible 30.

One widely used measure of a bank's earnings is return on equity, calculated by dividing net income (essentially profit) by the total amount of equity. The most recent annualized quarterly return on equity for Raymond James Bank, National Association was 14.67 percent, above the national average of 8.10 percent.

The bank earned net income of $260.4 million on total equity of $1.82 billion for the twelve months ended December 31, 2017. The bank reported an annualized return on average assets, or ROA, of 1.30 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.