S&P Global Market Intelligence Ranks the Best-Performing Community Banks for 2015
Northern Bancorp takes the top spot in ranking of community banks between $1 billion and $10 billion in assets
S&P Global Market Intelligence, formerly S&P Capital IQ and SNL Financial, today released its annual rankings of 2015’s 100 best-performing banks in two categories: community banks with assets between $1 billion and $10 billion and community banks with assets less than $1 billion.
Of the best-performing community banks with assets between $1 billion and $10 billion, Woburn, Mass.-based Northern Bancorp Inc. earned the top place. Northern Bancorp has more than doubled in size since 2010, ending 2015 with $1.41 billion in assets. Last year, the company's loan portfolio grew by 6.43%, and its fully-taxable equivalent net interest margin was 4.21%. Coming in as first and second runners-up, respectively, were Choice Financial Holdings Inc. of Fargo, North Dakota, and Preferred Bank of Los Angeles, California.
In the category of best-performing community banks with assets under $1 billion, Kansas-based Almena State Bank took the top spot. Almena State Bank finished 2015 with $63.3 million in assets, a 3.19% return on average tangible assets and a net interest margin of 5.31%. Edmond, Okla.-based Prime Bank took the runner-up spot this year after ranking No. 37 in last year's small community bank ranking, which looked at banks under $500 million in assets. Miles, Tex.-based Citizens State Bank was the only bank to feature in the top 10 in 2014 and 2015, moving up one spot to third. In light of recent changes to the Federal Reserve Board's Small Bank Holding Company Policy Statement, S&P Global Market Intelligence raised the asset threshold for the small community bank ranking to $1 billion from $500 million.
For these rankings, S&P Global Market Intelligence defined community banks as institutions with up to $10 billion in assets and 60 or fewer offices. In order for a bank to be eligible for the rankings, at least one-third of its balance sheet must be composed of loans, less than half of which could be attributable to credit card lending. Eligible banks had to be well-capitalized according to regulatory standards and could not have a majority of revenue derived from nontraditional banking activities.
For the $1 billion-to-$10 billion ranking, S&P Global Market Intelligence ranked companies at the bank holding company level if consolidated data was reported; otherwise, the commercial bank subsidiary was used. Thrifts and companies that have parents with assets above $10 billion were excluded. For the under-$1 billion ranking of commercial banks, companies with a parent with more than $1 billion in assets were excluded. Based on these criteria, 372 companies were eligible for the $1 billion-to-$10 billion ranking, and 4,258 banks were eligible for the under-$1 billion ranking.
S&P Global Market Intelligence ranked the best-performing community banks using six core financial performance metrics that focus on profitability, asset quality and growth for the 12-month period ended Dec. 31, 2015. The metrics used include return on average tangible assets before tax, net charge-offs as a percentage of average loans, adjusted Texas ratio, efficiency ratio, net interest margin and loan growth. S&P Global Market Intelligence measured each company's standard deviation from the mean of each metric. The standard deviations were equally weighted then added together to calculate a performance score for each company. The scores were capped to help normalize the data.
Click here for the 2014 ranking of the top 100 community banks between $500 million and $5 billion in assets.
Click here for the 2014 ranking of the top 100 community banks under $500 million in assets.
S&P Global Market Intelligence will recognize the top performers in person at the fifth annual SNL Community Bankers Conference, March 30-31st, at The Four Seasons Resort and Club Dallas at Las Colinas in Irving, Texas. The conference features community bankers and advisors from across the country sharing operational and financial strategies they've found useful in driving profitability. Details and registration can be found at the SNL Knowledge Center’s website.
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