DepositAccounts.com, a subsidiary of LendingTree, has released its list of the 2020 Top 200 Healthiest Banks in America. Jefferson Bank and Trust is honored to be listed as #99 out of 5,035 FDIC Insured Banks.
“It is such an honor to have our Jefferson Bank and Trust recognized among the top 200 healthiest in America,” said Bradley A. Locke, Executive Vice President. “Being part of this list shows our commitment to excellence.”
DepositAccounts.com evaluates the financial health of over 10,000 banks and credit unions in the United States once per quarter. To determine bank ranking and recognition, DepositAccounts.com grades each institution on a number of factors, including capitalization, deposit growth, and loan-to-reserve ratios.
“We believe it is important to give consumers a way to evaluate the financial health of their institutions,” said Ken Tumin, founder of DepositAccounts.com. “Our list empowers consumers to make informed decisions when selecting a financial institution.”
Boasting an A+ DepositAccounts Health Grade
For Q1 2020, the financial health analysts at DepositAccounts.com have rewarded Jefferson Bank and Trust Company with an A+ rating; the highest health grade given out by DepositAccounts. Financial institutions are graded on a scale from F (worst) to A+ (healthiest). Jefferson Bank and Trust Company is ranked as #99 out of the 5,035 US banks analyzed.
Once per quarter, DepositAccounts.com evaluates the financial health of over 10,000 banks and credit unions in the United States. A comprehensive health score is calculated, as each institution is graded on several factors including capitalization, deposit growth, and loan-to-reserve ratios.
A quick, at-a-glance indicator of bank financial health is its available capital. You can figure available capital with a direct calculation of an institution’s assets minus its liabilities. Stronger capital means that more assets are available to cover potential losses.
When people put money in a bank, it is an indicator of confidence. It also increases the money that a bank has on-hand and can help strengthen the balance sheet of the bank. A strong track record of stable growth is an indicator of consumer confidence and the bank’s ability to strengthen its balance sheet. The opposite can be an indicator of a decline in confidence in the institution and, if pronounced and prolonged, can mean that the bank’s ability to keep a strong balance sheet is in jeopardy.
Developed at RBC Capital Markets, the Texas Ratio is a relatively straightforward and effective way to determine the overall credit troubles experienced by financial institutions. It is determined by comparing the total value of at-risk loans to the total value of funds the bank has on-hand to cover these loans. At-risk loans are any loans that are more than 90 days past due and are not backed by the government. The amount of funds on-hand consists of the loan loss allowance that the bank has set aside plus any equity capital.
For example, a bank with $65 million in at-risk loans and $72 million in cash on-hand to cover those loans would have a Texas Ratio of $65mm / $72mm, which is 90.3%. This figure is approaching the 100% threshold, which is considered very risky. You can also look at the trend in this Texas Ratio as an additional factor to tell if the bank’s financial health is heading in the right direction.
DepositAccounts.com is the largest and most comprehensive online publication in the U.S. dedicated to banking and deposits product information for consumers. It covers every federally insured bank and credit union and utilizes its patented technology to track approximately 275,000 consumer deposit rates, each updated nightly. The site features more than 11,000 editorial articles detailing depository strategies and highlighting current bank rates and offers. It is also home to one of the largest communities of depositors on the Web, hosting more than 100,000 comments, customer reviews, and forum threads.