Safe and Sound

The Bank of San Jacinto County, Coldspring, Texas

Coldspring, TX
4
Star Rating
The Bank of San Jacinto County, Coldspring, Texas is a Coldspring, TX-based, FDIC-insured bank started in 1963. Regulatory filings show the bank having equity of $5.2 million on $42.1 million in assets, as of December 31, 2017.

With 15 full-time employees, the bank holds loans and leases worth $15.5 million, including real estate loans of $12.9 million. U.S. bank customers currently have $36.8 million in deposits with the bank.

Overall, Bankrate believes that, as of December 31, 2017, The Bank of San Jacinto County, Coldspring, Texas exhibited a good condition, earning 4 out of 5 stars for safety and soundness. Keep reading for an analysis of how the bank fared on the three key criteria Bankrate used to grade American banks.

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THE INSTITUTION'S SCORE

Capital Score

Capital acts as a buffer against losses and affords protection for account holders during times of economic trouble for the bank. Therefore, a bank's level of capital is an important measurement of an institution's financial strength. From a safety and soundness perspective, the higher the capital, the better.

On our test to measure capital adequacy, The Bank of San Jacinto County, Coldspring, Texas scored 16 out of a possible 30 points, better than the national average of 13.13.

One way to measure this buffer is looking at a bank's Tier 1 capital ratio. The Bank of San Jacinto County, Coldspring, Texas's Tier 1 capital ratio was 40.18 percent, higher than the 6 percent level considered adequate by regulators, and higher than the national average of 25.65 percent. The higher the capital ratio, the better the bank will be able to weather economic challenges.

Overall, The Bank of San Jacinto County, Coldspring, Texas held equity amounting to 12.30 percent of its assets, which exceeded the national average of 12.03 percent.

Asset Quality Score

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

A bank with a large number of these kinds of assets may eventually have to use capital to absorb losses, reducing its buffer of equity. Many of those assets are also likely to be 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.

The Bank of San Jacinto County, Coldspring, Texas scored 40 out of a possible 40 points on Bankrate's test of asset quality, exceeding 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, none of The Bank of San Jacinto County, Coldspring, Texas'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 maintain a reserve known as an "allowance for loan and lease losses" to deal with troubled assets . Comparing the reserve's size to the total amount of problem loans can be a useful indicator when evaluating a bank's ability to manage troubled assets. Unfortunately, the FDIC did not provide information on The Bank of San Jacinto County, Coldspring, Texas's loan loss allowance in its most recent filings.

Earnings score

A bank's profitability has an effect on its long-term survivability. A bank can retain its earnings, giving a boost to its capital cushion, 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.

On Bankrate's test of earnings, The Bank of San Jacinto County, Coldspring, Texas scored 12 out of a possible 30, failing to reach the national average of 15.12.

Return on equity, calculated by dividing net income (essentially, profit) by the total amount of equity, is one important way to measure a bank's earnings. The most recent annualized quarterly return on equity for The Bank of San Jacinto County, Coldspring, Texas was 5.12 percent, below the national average of 8.10 percent.

For the twelve months ended December 31, 2017, the bank earned net income of $261,000 on total equity of $5.2 million. The bank had an annualized return on average assets, or ROA, of 0.66 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.