Conservatism Rules the Day in Bank Director Magazine’s 2009 Bank Performance Scorecard

New York – February 18, 2010 – Bank Director magazine recently announced in its First Quarter 2010 issue the results of its fifth annual Bank Performance Scorecard. The Scorecard is based on measurement criteria and analysis of 150 banks with $3 billion or more in assets, and is compiled by Sandler O’Neill & Partners L.P., a New York based investment banking firm that specializes in the financial services industry.

As this year’s list shows, despite the upheaval of bank balance sheets across America, there are many financial institutions still going strong, especially ones that adhere to a basic formula for successful banking: lend money to low-risk borrowers, keep expenses under control, and dominate local market share. 

In 2009, plain-vanilla banking won out over the growth-at-any-cost mentality. In addition, most of the top 10 financial institutions are commercially focused, which shielded them from heavy losses stemming from deteriorating residential and consumer loans. 

Among the top performers, size mattered, with banks with $3 billion to $12 billion in assets faring best. “It was really a year where being smaller was better,” says Mark Fitzgibbon, Sandler’s director of research who oversaw the Scorecard’s compilation. “The midsize and smaller companies tend to be a little more conservative. During this past year, conservatism was critically important. The companies that were conservative tended to outperform.” 

First Financial Bankshares of Abilene, Texas, which ranked No. 1 on the Scorecard this year, received high scores in four of the six metrics used to gauge performance, while holding its own in the others. The bank, with $3.1 billion in second-quarter 2009 assets, operates as a multibank holding company with 50 locations in west and north Texas.

The top 10 performers in the 2009 Scorecard are:

  1. First Financial Bankshares, Abilene, Texas
  2. Bank of the Ozarks, Little Rock, Arkansas
  3. Glacier Bancorp, Kalispell, Montana
  4. Westamerica Bancorporation, San Rafael, California
  5. Republic Bancorp, Louisville, Kentucky
  6. Bank of Hawaii, Honolulu, Hawaii
  7. International Bancshares Corp., Laredo, Texas
  8. 1st Source Corp., South Bend, Indiana
  9. CVB Financial Corp., Ontario, California
  10. Signature Bank, New York, New York

A complete list of the Top 150 Performers can be seen in the 2010 first quarter issue of Bank Director and at {CCM:BASE_URL}/issues/2010_1/.

About the Bank Performance Scorecard
The Bank Director Performance Scorecard is comprised of six performance categories that measure profitability, capitalization, and asset quality. The Scorecard gives the two profitability metrics a full weighing in the final score for each institution. The other four metrics are given a half weighing in the final tally. The Scorecard was developed in consultation with Sandler O’Neill, which also performed all of the necessary calculations using publicly available data.

About Bank Director
Bank Director magazine is the leading information resource for senior officers and directors of financial institutions, credit unions, insurance companies and investment advisors. The quarterly publication provides readers with the tools necessary to successfully handle the governance challenges impacting boards including mergers and acquisitions, retail strategies, compensation and technology. Since its inception in 1991, Bank Director has become recognized as the essential resource for top decision makers in the financial services industry. For more information, visit www.bankdirector.com

Jonathan Hartman