Safe and Sound

Security Bank of Pulaski County

Saint Robert, MO
2
Star Rating
Saint Robert, MO-based Security Bank of Pulaski County is an FDIC-insured bank started in 1936. Regulatory filings show the bank having equity of $9.3 million on assets of $109.7 million, as of December 31, 2017.

U.S. bank customers have $97.7 million on deposit at 3 offices in MO run by 32 full-time employees. With that footprint, the bank currently holds loans and leases worth $65.8 million, $47.0 million of which are for real estate.

Overall, Bankrate believes that, as of December 31, 2017, Security Bank of Pulaski County exhibited a below-average condition, earning 2 out of 5 stars for safety and soundness. Keep reading for a look at how the bank did on the three key criteria Bankrate used to score U.S. banks.

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THE INSTITUTION'S SCORE

Capital Score

When it comes to measuring an an institution's financial resilience, capital is crucial. It works as a cushion against losses and provides protection for accountholders when a bank is struggling financially. When it comes to safety and soundness, the more capital, the better.

Security Bank of Pulaski County fell below the national average of 13.13 on our test to measure the adequacy of a bank's capital, receiving a score of 8 out of a possible 30 points.

One way to measure this buffer is looking at a bank's Tier 1 capital ratio. Security Bank of Pulaski County's Tier 1 capital ratio was 11.96 percent, exceeding the 6 percent level regulators consider adequate, but less than the national average of 25.65 percent. The higher the capital ratio, the better the bank will be able to weather financial downturns.

Overall, Security Bank of Pulaski County held equity amounting to 8.49 percent of its assets, which was lower than the national average of 12.03 percent.

Asset Quality Score

This test is intended to try to understand how the bank's loan loss reserves and overall capitalization could be affected by troubled assets, such as past-due loans.

A bank with a large number of these kinds of assets could eventually be forced to use capital to absorb losses, cutting down on its equity buffer. It also means that there are likely to be many assets that are in non-accrual status and thus aren't earning money, resulting in diminished earnings and potentially more risk of a future failure.

On Bankrate's asset quality test, Security Bank of Pulaski County scored 24 out of a possible 40 points, falling short of the national average of 37.49 points.

A useful indicator of asset quality is the percentage of problem assets a bank holds compared to its total assets. As of December 31, 2017, 0.44 percent of Security Bank of Pulaski County'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 keep a reserve known as an "allowance for loan and lease losses" to deal with troubled assets . Comparing the size of that reserve to the total amount of problem loans can be a handy indicator when evaluating a bank's ability to manage problem assets. Unfortunately, the FDIC did not provide information on Security Bank of Pulaski County's loan loss allowance in its most recent filings.

Earnings score

How profitable a bank is has an effect on its long-term survivability. A bank can retain its earnings, giving a boost to its capital cushion, or use them to address problematic loans, likely making the bank better able to withstand economic shocks. Conversely, losses take away from a bank's ability to do those things.

Security Bank of Pulaski County received below-average marks on Bankrate's test of earnings, achieving a score of 10 out of a possible 30.

Return on equity, calculated by dividing net income (profit, basically) by total equity, is one important way to measure a bank's earnings. The most recent annualized quarterly return on equity for Security Bank of Pulaski County was 4.95 percent, below the national average of 8.10 percent.

For the twelve months ended December 31, 2017, the bank earned net income of $461,000 on total equity of $9.3 million. The bank had an annualized return on average assets, or ROA, of 0.44 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.