Safe and Sound

The First National Bank and Trust Company of Vinita

Vinita, OK
4
Star Rating
Vinita, OK-based The First National Bank and Trust Company of Vinita is an FDIC-insured bank started in 1892. Regulatory filings show the bank having equity of $35.4 million on $412.4 million in assets, as of December 31, 2017.

With 87 full-time employees in 4 offices in OK, the bank currently holds loans and leases worth $253.2 million, including real estate loans of $128.3 million. U.S. bank customers currently have $376.4 million in deposits with the bank.

Overall, Bankrate believes that, as of December 31, 2017, The First National Bank and Trust Company of Vinita exhibited a good condition, earning 4 out of 5 stars for safety and soundness. Here's a look at how the bank fared 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 a bank's financial strength, capital is crucial. It acts as a buffer against losses and affords protection for accountholders during periods of economic instability for the bank. When it comes to safety and soundness, more capital is better.

The First National Bank and Trust Company of Vinita scored 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.

A bank's Tier 1 capital ratio is a commonly used measure of this buffer. The First National Bank and Trust Company of Vinita's Tier 1 capital ratio was 12.29 percent, higher than the 6 percent level regulators consider adequate, but under the national average of 25.65 percent. The higher the capital ratio, the better the bank will be able to weather financial challenges.

Overall, The First National Bank and Trust Company of Vinita held equity amounting to 8.58 percent of its assets, which was lower than the national average of 12.03 percent.

Asset Quality Score

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

Having large numbers of these types of assets means a bank may eventually have to use capital to cover losses, cutting down on its cushion of equity. Many of those assets are also likely to be in non-accrual status and no longer earning interest for the bank, pushing down earnings and increasing the risk of a failure in the future.

On Bankrate's asset quality test, The First National Bank and Trust Company of Vinita scored 32 out of a possible 40 points, less than 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, 1.51 percent of The First National Bank and Trust Company of Vinita's loans were noncurrent, meaning they were more than 90 days past due or were in non-accrual status. That's above the national average of 1.01 percent.

Banks keep a reserve to handle troubled assets known as an "allowance for loan and lease losses." The size of that reserve can be a useful 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 The First National Bank and Trust Company of Vinita's loan loss allowance in its most recent filings.

Earnings score

How profitable a bank is has an effect on its safety and soundness. A bank can retain its earnings, increasing its capital cushion, or use them to deal with problematic loans, potentially making the bank more resilient in times of trouble. However, banks that are losing money have less ability to do those things.

The First National Bank and Trust Company of Vinita scored 22 out of a possible 30 on Bankrate's earnings test, beating out the national average of 15.12.

One key way to measure a bank's earnings is return on equity, or net income (essentially profit) divided by the total amount of equity. The First National Bank and Trust Company of Vinita's most recent annualized quarterly return on equity was 14.27 percent, above the national average of 8.10 percent.

The bank recorded net income of $4.7 million on total equity of $35.4 million for the twelve months ended December 31, 2017. The bank experienced an annualized return on average assets, or ROA, of 1.16 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.