Safe and Sound

Shamrock Bank, N.A.

Coalgate, OK
5
Star Rating
Founded in 1924, Shamrock Bank, N.A. is an FDIC-insured bank headquartered in Coalgate, OK. Regulatory filings show the bank having equity of $35.2 million on assets of $307.1 million, as of December 31, 2017.

With 88 full-time employees in 7 offices in OK, the bank holds loans and leases worth $192.1 million, including real estate loans of $135.4 million. U.S. bank customers currently have $270.5 million in deposits with the bank.

Overall, Bankrate believes that, as of December 31, 2017, Shamrock Bank, N.A. exhibited a superior condition, earning a full 5 stars for safety and soundness. Here's a look at how the bank did on the three important criteria Bankrate used to score U.S. banks on safety and soundness.

WHAT IS
SAFE AND SOUND?

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THE INSTITUTION'S SCORE

Capital Score

Capital is a valuable measurement of an institution's financial strength. It acts as a cushion against losses and affords protection for depositors when a bank is struggling financially. When it comes to safety and soundness, more capital is preferred.

Shamrock Bank, N.A. scored above the national average of 13.13 points on our test to measure the adequacy of a bank's capital, scoring 14 out of a possible 30 points.

One commonly used measure of this buffer is a bank's Tier 1 capital ratio. Shamrock Bank, N.A.'s Tier 1 capital ratio was 17.25 percent, higher than the 6 percent level regulators consider adequate, but lower than the national average of 25.65 percent. A higher capital ratio means the bank will be better able to stand up to economic headwinds.

Overall, Shamrock Bank, N.A. held equity amounting to 11.45 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 impact of troubled assets, such as past-due loans, on the bank's loan loss reserves and overall capitalization.

A bank with extensive holdings of these kinds of assets may eventually have to use capital to absorb 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, reducing earnings and increasing the risk of a future failure.

On Bankrate's asset quality test, Shamrock Bank, N.A. scored 40 out of a possible 40 points, exceeding the national average of 37.49 points.

The percentage of problem assets a bank holds compared to its total assets is a helpful indicator of asset quality.As of December 31, 2017, 0.46 percent of Shamrock Bank, N.A.'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 1.01 percent.

Banks keep a reserve to handle problem assets known as an "allowance for loan and lease losses." Comparing how large that reserve is to the total amount of at-risk loans can be a useful indicator when evaluating a bank's ability to manage troubled assets. Unfortunately, the FDIC did not provide information on Shamrock Bank, N.A.'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, expanding its capital buffer, or put them to work addressing problematic loans, potentially making the bank better prepared to withstand economic shocks. Obviously, banks that are losing money have less ability to do those things.

Shamrock Bank, N.A. scored 22 out of a possible 30 on Bankrate's earnings test, beating the national average of 15.12.

Return on equity, calculated by dividing net income (essentially, profit) by total equity, is one widely used measure of a bank's earnings. Shamrock Bank, N.A.'s most recent annualized quarterly return on equity was 11.99 percent, above the national average of 8.10 percent.

The bank recorded net income of $4.3 million on total equity of $35.2 million for the twelve months ended December 31, 2017. The bank reported an annualized return on average assets, or ROA, of 1.43 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.