Highlighting the strong stability of Mississippi’s banks, Bauer Financial has awarded five-star “Superior” ratings to over half of the state’s banks for their first-quarter performance, including two of the largest banks — Hancock Bank and Trustmark Bank.
Two other major Mississippi banking entities — Birmingham-based Regions Bank and Tupelo’s Bancorp South — received the three-and-a-half star ranking of “Good” from the Coral Gables-based financial services rating firm.
Bauer weighs each bank’s level of tier 1 risk-based capital and total risk-based capital ratio, as well as any profitability-and-loss trend. It also evaluates the level of delinquent loans, charge-offs and repossessed assets, the market versus book value of the investment portfolio, regulatory supervisory agreements, the community reinvestment rating (CRA), historical data and liquidity.
The bulk of the banks that fell short of achieving five stars won either four-star “Excellent” or three-and-a-half star ratings from the Coral Gables-based financial services rating firm.
Fewer than a half dozen banks received the three-star grade of “Adequate,” while one — SouthBank FSB of Corinth — ended the quarter with a two-star rating of “troubled.”
OmniBank of Bay Springs was the lone single-star entry, a designation Bauer reserves for “Problematic” banks. The FDIC-regulated bank’s assets fell from $75 million in the first quarter last year to $48.5 million in this year’s first quarter, according to the FDIC. The bank, which has three locations and 30 employees, had overdue loans and leases of $3.8 million at the close of the quarter.
SouthBank FSB of Corinth is a full savings bank owned by Huntsville, Ala.-based SouthBank, which ended the first quarter with $194 million in assets and $5.5 million in overdue loans and leases.
In assessing the national banking sector at the close of the quarter, the FDIC says downward pressure on net interest margins is a principal reason revenue has been nearly flat—growing just 1.6 percent from a year ago.
Martin J. Gruenberg, FDIC chairman, said in his first quarter national banking profile that
insured institutions added more than $500 billion in interest-earning assets to their balance sheets over the past year. “Yet, the interest income produced by these assets fell by $6 billion. This is because older, higher-yielding assets are maturing off bank balance sheets and are being replaced by lower-yielding assets,” he said.
The Federal Reserve’s Board of Governor’s Beige Book report on June 5 said the Atlanta region, which covers the southern half of Mississippi, saw weak overall demand for
new loans “as banks faced significant pressure to improve net interest margins and increased competition from non-bank providers of capital, such as private equity groups.”
Bankers noted that businesses in the Atlanta Fed region were taking on debt where necessary to maintain and refurbish equipment to meet current demand rather than making capital investment aimed at future growth.
The St. Louis Fed district, which covers central and northern Mississippi, noted in the June 5 report that credit standards and demand for consumer loans remained mostly unchanged. Demand for auto loans ranged from moderately stronger to moderately weaker, while demand for other consumer loans was unchanged, the Beige Book report said.
The report noted that economic implications could arise from late planting of row crops in Mississippi and elsewhere in the region. “Because of persistent rains, district farmers are behind their average planting schedules. Planting progress for cotton, rice, and soybeans in Mississippi was approximately half the 5-year average,” the Fed report said..
Here are the Mississippi banks that achieved 5-star ratings:
» Bank of Anguilla: Anguilla,
» Bank of Benoit: Benoit;
» Bank of Bolivar County: Shelby;
» Bank of Brookhaven: Brookhaven;
» Bank of Commerce: Greenwood:
» Bank of Forest: Forest;
» Bank of Jones County: Laurel;
» Bank of Morton: Morton;
» Bank of Walnut Grove: Walnut Grove;
» Bank of Yazoo City: Yazoo City;
» BankFirst Financial Services: Macon;
» Charter Bank: Biloxi;
» Citizens Bank: Byhalia;
» Citizens Bank: Columbia;
» Cleveland State Bank: Cleveland;
» Commerce National Bank: Corinth;
» Covington County Bank: Collins;
» Farmers and Merchants Bank: Baldwyn;
» First American National Bank: Iuka;
» First Bank: McComb;
» First Federal Savings and Loan: Aberdeen;
» First Federal Savings and Loan: Pascagoula;
» First National Bank of Clarksdale: Clarksdale;
» First National Bank of Oxford: Oxford;
» First National Bank of Pontotoc: Pontotoc;
» First Southern Bank: Columbia;
» First State Bank: Waynesboro;
» Great Southern National Bank: Meridian;
» Hancock Bank: Gulfport;
» Jefferson Bank: Fayette;
» Magnolia State Bank: Bay Springs;
» Merchants and Marine Bank: Pascagoula;
» Newton County Bank: Newton;
» Oxford University Bank: Oxford;
» Peoples Bank: Ripley;
» Peoples Bank and Trust: North Carrollton;
» Planters Bank and Trust: Indianola;
» Richton Bank and Trust: Richton;
» Sycamore Bank: Senatobia;
» Tallahatchie County Bank: Charleston;
» Trustmark National Bank: Jackson;
» United Mississippi Bank: Natchez;