Safe and Sound

Savannah Bank National Association

Savannah, NY
4
Star Rating
Savannah Bank National Association is an FDIC-insured bank started in 1925 and currently based in Savannah, NY. Regulatory filings show the bank having equity of $11.9 million on $140.1 million in assets, as of December 31, 2017.

Thanks to the work of 40 full-time employees in 5 offices in NY, the bank has amassed loans and leases worth $67.1 million, including real estate loans of $54.3 million. The bank currently holds $127.0 million in deposits from U.S. customers.

Overall, Bankrate believes that, as of December 31, 2017, Savannah Bank National Association exhibited a good condition, earning 4 out of 5 stars for safety and soundness. Here's a breakdown of how the bank fared on the three important criteria Bankrate used to score American banks.

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THE INSTITUTION'S SCORE

Capital Score

Capital works as a cushion against losses and as protection for account holders during times of financial trouble for the bank. It follows then that a bank's level of capital is a valuable measurement of a bank's financial resilience. From a safety and soundness perspective, more capital is better.

Savannah Bank National Association scored below the national average of 13.13 on our test to measure capital adequacy, scoring 8 out of a possible 30 points.

One essential measure of this buffer is a bank's Tier 1 capital ratio. Savannah Bank National Association's Tier 1 capital ratio was 15.97 percent, above the 6 percent level regulators consider adequate, but less than the national average of 25.65 percent. A higher capital ratio means the bank will be better able to weather economic challenges.

Overall, Savannah Bank National Association held equity amounting to 8.49 percent of its assets, which was lower than the national average of 12.03 percent.

Asset Quality Score

In this test, Bankrate tries to estimate the effect of troubled assets, such as past-due loans, on the bank's capitalization and allocated loan loss reserves.

Having large numbers of these kinds of assets means a bank may have to use capital to cover losses, cutting down on its equity buffer. Many of those assets are also likely to be in non-accrual status and no longer earning money, resulting in depressed earnings and potentially more risk of a failure in the future.

On Bankrate's asset quality test, Savannah Bank National Association scored 40 out of a possible 40 points, beating out the national average of 37.49 points.

A handy indicator of asset quality is the percentage of problem assets a bank holds compared to its total assets. As of December 31, 2017, 0.48 percent of Savannah Bank National Association'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 1.01 percent.

Banks maintain a reserve to handle troubled assets known as an "allowance for loan and lease losses." That reserve's size can be a helpful 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 Savannah Bank National Association's loan loss allowance in its most recent filings.

Earnings score

How profitable a bank is has an effect on its long-term survivability. Earnings may be retained by the bank, increasing its capital buffer, or be used to deal with problematic loans, potentially making the bank better prepared to withstand financial trouble. However, banks that are losing money have less ability to do those things.

Savannah Bank National Association scored 20 out of a possible 30 on Bankrate's test of earnings, above the national average of 15.12.

One important measure of a bank's earnings is return on equity, calculated by dividing net income (profit, basically) by the total amount of equity. Savannah Bank National Association's most recent annualized quarterly return on equity was 10.38 percent, above the national average of 8.10 percent.

The bank earned net income of $1.2 million on total equity of $11.9 million for the twelve months ended December 31, 2017. 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.