271 Financial Institutions With Combined Assets Over $130 Billion at Extreme Risk of Failure
NEW YORK, NY and AUSTIN, TX--(Marketwire - June 17, 2010) - Highline Financial, the preferred source for banking information and analytics for the financial sector, has developed a Watch List based on the Highline Rating, detailing the worst performing US financial institutions including commercial banks, savings banks and savings & loans.
According to Highline Financial, 796 financial institutions with assets close to $478 billion are on the Highline Watch List. The Watch List includes institutions with a Highline Peer Rating below 10 for three consecutive quarters. Of that list, 271 financial institutions with assets over $130 billion are at extreme risk of failing this year with a Highline Peer Rating at 0 for three consecutive quarters.
The 271 institutions at extreme risk break out by asset size as follows:
|Assets||Number of Institutions|
|$1 - 10B||17|
|$250M - 1B||71|
|$ < 250M||181|
According to Highline Financial, the number of US bank and savings & loan failures in 2010 are set to surpass the totals for 2009. In 2009, there were 139 failures with combined total assets of $169 billion. Through June 11 2010, 82 banks and S&Ls had failed with combined assets of $71 billion.
Highline Financial rates every bank, S&L, credit union and consolidated bank holding company on a quarterly basis. The Highline Rating is based on a scale from 0 - 99 with 0 being the lowest and 99 being the highest. Highline rates over 8,000 commercial banks, savings banks and savings & loans as well as over 7,500 credit unions and 1,300 bank holding companies.
Terry Waters, Highline Financial CEO, said, "The Highline Rating offers the market a strong predictor of any financial institution's health and potential for failure, whether it is a bank, credit union, S&L or holding company. The Highline Rating excels at forecasting an institution's troubles far in advance of failure. Of the commercial banks, savings banks and savings & loans that have failed since 2008, 75% had a Highline Financial Peer Group Rating of 0 three quarters before they failed. In the current economic climate, providing our clients with visibility up to three quarters out is a key way we help them manage financial risks and make profitable investment decisions every day."
The Highline Rating compares institutions on a national, regional basis and by asset size. Regionally, banks in four states -- Georgia, Florida, California and Illinois -- have been the hardest hit. Of the failed banks in the US since 2008, more than half have occurred in these states: Georgia (16%), Illinois (14%), California (11%), and Florida (11%).
The top performing states as measured by the fewest bank failures include Nebraska, and three states in the northeast: Massachusetts, Vermont, and Rhode Island. Top performing institutions in Massachusetts, Vermont, Rhode Island, and Nebraska included community banks such as: Danvers Bank (Danvers, MA); Peoples Bank (Holyoke, MA); Merchants Bank (Burlington, VT); Centreville Savings Bank (West Warwick, RI); Bank Newport (Newport, RI); and World's Foremost Bank (Sidley, NE.)
The top performers among large banking institutions (banks with assets of $10 billion or greater) include: State Street (Boston, MA); Valley National Bank (Passaic, NJ); Silicon Valley Bank (Santa Clara, CA); Northern Trust (Chicago, IL); First Hawaiian (Honolulu, HI); Commerce Bank NA (Kansas City, MO); Bank of Hawaii (Honolulu, HI); and First National Bank of Omaha (Omaha, NE).
About Highline Financial Ratings
The Highline Rating has been used for rating banks, S&Ls, credit unions and bank holding companies since 1985. Originally developed by Sheshunoff Information Services, it was first known as the Sheshunoff Rating. Over the last 24 years, the Highline Rating has undergone periodic evaluations and improvements to ensure its effectiveness as a strong predictor of a financial institution's health and potential for failure.
The Highline Rating is calculated on a quarterly basis using four key ratios (capital adequacy, asset quality, earnings strength and liquidity) and encompasses both current and historical data. In addition, all ratings assess an institution's health using weighted criteria to evaluate the industry's condition as a whole, with ratios and respective weights adjusting to meet industry changes. Used by government entities, and leading investment banks, law firms, advisories, and other financial institutions, the Highline Rating enables companies to manage financial risk and make profitable investment decisions on a daily basis.
About Highline Financial
Highline Financial is the preferred source of banking information and tools with decades of experience serving the financial industry. Our mission is to deliver the highest quality and most relevant banking data and analytics solutions that enable our clients to manage financial risks and make profitable investment decisions every day, at a lower cost of ownership. We do this by combining our focused industry expertise in banking with best of breed industry partnerships to fulfill the real-time strategic needs of executives, business leaders and analysts in financial institutions, corporations and public sector agencies. For more information visit www.highlinefi.com
Lisa Jane O'Neil