Investing Answers Building and Protecting Your Wealth through Education Publisher of The Next Banks That Could Fail
Investing Answers Building and Protecting Your Wealth through Education Publisher of The Next Banks That Could Fail

The 383 Safest Banks in America

Editor's note: This article is updated as of Sept. 21, 2012, to reflect FDIC data from the second quarter of 2012. 

In America, we have let our guard down when it comes to our banking relationships. We assume that everything will be fine if our bank fails. After all, the FDIC insures our deposits up to $250,000. Why worry? 

I hate to break this to you, but the FDIC's Deposit Insurance Fund (DIF) -- AKA the money used to cover bank failures -- has been all but drained. 

In 2007, the DIF had a healthy $52.4 billion. But since 2008 (after the housing meltdown), more than 413 banks have failed, and it's taken a devastating toll on the once-solid reserve fund.

According to the FDIC, the balance in the DIF at the end of Q2 2012 was just $22.7 billion -- almost 57% below where it was before the financial crisis. And while the FDIC also reported that banks are on slightly better financial footing than last quarter, there are still a staggering 732 "problem banks" that are carrying troubled assets totaling $282 billion. By comparison, the FDIC identified just 76 problem banks by the end of 2007.

I don't know about you, but I'm not willing to assume that the FDIC will always be there to cover my savings. Instead, I want to pick the safest bank in my area, so that I know the FDIC will never have to get involved.

Each quarter, I use FDIC data to calculate a very special metric called the "Texas ratio." 

The Texas ratio was first developed by a financial wizard named Gerard Cassidy who used it to correctly predict bank failures in Texas in the 1980s. While the ratio has been excellent at predicting bank failures, it can also be used to find the safest banks in America. 

The math can get complicated (click here if you're interested in the details), but here's what you need to know -- the ratio looks at the number of "bad assets" a bank owns versus the amount of equity in the bank. If there are too many bad assets and/or not enough equity, a bank becomes very vulnerable. The closer the Texas ratio gets to zero, the lower the bank's risk of failure. Once the ratio gets above 1.0, things get a little shaky.

To illustrate, here's a list of the last 10 banks that were seized by FDIC. In every case, the Texas ratio is above 1.0.

 




10 Most Recently Failed Banks
Bank Name Headquartered In State Ratio
  black; font-size: 11.0pt; font-weight: 400; font-style: normal; text-decoration: none; white-space: nowrap; border-left: medium none; border-right: .5pt solid windowtext; border-top: medium none; border-bottom: .5pt solid windowtext; padding-left: 1px; padding-right: 1px; padding-top: 1px" width="162">St. Louis MO 3.92
First Commercial Bank Bloomington MN 4.64
Waukegan Savings Bank Waukegan IL 4.95
Jasper Banking Company Jasper GA 8.14
Second FSL Association of Chicago Chicago IL 9.00
First Cherokee State Bank Woodstock GA 7.04
Georgia Trust Bank Buford GA 5.97
The Royal Palm Bank of Florida Naples FL 2.95
Heartland Bank Leawod KS 1.49
Glasgow Savings Bank Glasgow MO 2.01

 

And out of the five largest banks in the United States, none have a perfect score, but Chase and Citibank come closest to the mark. Their scores are highlighted in the chart below, showing the top banks' Texas ratios.

 




5 Largest Banks In The United States
Bank Name Headquartered In State Ratio
Bank of America Charlotte NC 0.22
Chase Bank Newark DE 0.07
Citibank Sioux Falls SD 0.07
Wells Fargo Bank Sioux Falls SD 0.30
U.S. Bank Cincinnati OH 0.18

 

Right now there are over 7,300 banks in the United States, but only 383 of them can boast a perfect Texas ratio of 0.0.

And the list can change from quarter to quarter. For example, of the 359 banks that had perfect Texas ratios when we last published our list, about 60 no longer do.

That doesn't mean that the banks are no longer safe -- far from it, actually. The highest Texas ratio for a bank that fell off the list was 0.18, which is still a very strong score. 

While some dropped off the list, more than 80 others came on to it. The total number of banks with perfect Texas ratios grew from 359 to 383. Of the new banks on the list, most needed just a slight improvement -- such as from 0.001 to 0 -- to reach the perfect Texas ratio. 

That perfect score is exactly what our list is all about. 

Read on to see if your bank made the list:

Note: The banks listed in bold in the chart below did not appear in the previous version of this list, which was released in June 2012.



Name City State
Oakworth Capital Bank Birmingham AL
First Scottsdale Bank, N.A. Scottsdale AZ
Valley Republic Bank Bakersfield CA
Vibra Bank Chula Vista CA
California First National Bank Irvine CA
Capital Bank and Trust Company Irvine CA
Evergreen International Bank Long Beach CA
1st Enterprise Bank Los Angeles CA
Eastern International Bank Los Angeles CA
Premier Business Bank Los Angeles CA
The Bank of New York Mellon Trust Company, N.A. Los Angeles CA
Wells Fargo Bank, Ltd. Los Angeles CA
California Republic Bank Newport Beach CA
Malaga Bank FSB Palos Verdes Pen. CA
The Merchants National Bank of Sacramento Sacramento CA
Armed Forces Bank of California, N.A. San Diego CA
Focus Business Bank San Jose CA
First Federal Savings and Loan Association of San Rafael San Rafael CA
First American Trust, FSB Santa Ana CA
County Commerce Bank Ventura CA
AMG National Trust Bank Boulder CO
FlatIrons Bank Boulder CO
The Bank of Burlington Burlington CO
Trust Company of America Centennial CO
Young Americans Bank Denver CO
First FarmBank Greeley CO
The Colorado State Bank of Walsh Walsh CO
The MassMutual Trust Company Enfield CT
The Bank of Fairfield Fairfield CT
Fieldpoint Private Bank & Trust Greenwich CT
Prudential Bank & Trust, FSB Hartford CT
Start Community Bank New Haven CT
The National Iron Bank Salisbury CT
Bank of New Castle New Castle DE
HSBC Trust Company (Delaware), N.A. Wilmington DE
One South Bank Chipley FL
Broward Bank of Commerce Fort Lauderdale FL
First Green Bank Mount Dora FL
FirstCity Bank of Commerce North Palm Beach FL
Intracoastal Bank Palm Coast FL
Bank of the South Pensacola FL
First Navy Bank Pensacola FL
The Warrington Bank Pensacola FL
Prime Meridian Bank Tallahassee FL
Members Trust Company Tampa FL
NorthStar Bank Tampa FL
Invesco National Trust Company Atlanta GA
Independence Bank of Georgia Braselton GA
Community Business Bank Cumming GA
Chattahoochee Bank of Georgia Gainesville GA
Verity Bank Winder GA
Audubon State Bank Audubon IA
Benton County State Bank Blairstown IA
City State Bank Central City IA
Dysart State Bank Dysart IA
Hartwick State Bank Hartwick IA
Charter Bank Johnston IA
ITS Bank Johnston IA
Kerndt Brothers Savings Bank Lansing IA
First State Bank Manchester IA
Panora State Bank Panora IA
Pleasantville State Bank Pleasantville IA
Pocahontas State Bank Pocahontas IA
Peoples Trust and Savings Bank Riverside IA
First State Bank Stuart IA
Swisher Trust & Savings Bank Swisher IA
Victor State Bank Victor IA
Western Capital Bank Boise ID
Arcola First Bank Arcola IL
The Atlanta National Bank Atlanta IL
The First National Bank of Ava Ava IL
Country Trust Bank Bloomington IL
Buckley State Bank Buckley IL
Farmers State Bank of Camp Point Camp Point IL
American Union Savings and Loan Association, SB Chicago IL
Columbus Savings Bank Chicago IL
Washington Federal Bank For Savings Chicago IL
Cissna Park State Bank Cissna Park IL
Collinsville Building and Loan Association Collinsville IL
Community Bank of Easton Easton IL
Elkville State Bank Elkville IL
Farmers State Bank of Emden Emden IL
Farmer City State Bank Farmer City IL
Franklin Grove Bank Franklin Grove IL
Grand Ridge National Bank Grand Ridge IL
Farmers & Merchants Bank of Hutsonville Hutsonville IL
Midland Community Bank Kincaid IL
Heritage State Bank Lawrenceville IL
The Lemont National Bank Lemont IL
The State Bank of Lima Lima IL
Peoples Bank of Macon Macon IL
Farmers State Bank of Medora Medora IL
Nashville Savings Bank Nashville IL
North County Savings Bank Red Bud IL
Harris Central National Association Roselle IL
Sidell State Bank Sidell IL
Teutopolis State Bank Teutopolis IL
The Central National Bank and Trust Company Attica IN
Forethought Federal Savings Bank Batesville IN
Everence Trust Company Goshen IN
Ossian State Bank Ossian IN
Farmers Bank & Trust Atwood KS
The Bendena State Bank Bendena KS
The Farmers State Bank of Bucklin, Kansas Bucklin KS
The Stock Exchange Bank, Caldwell, Kansas Caldwell KS
Bank of Commerce Chanute KS
The State Bank of Conway Springs Conway Springs KS
Flint Hills Bank Eskridge KS
The City State Bank Fort Scott KS
The Liberty Savings Association, FSA Fort Scott KS
Garden City State Bank Garden City KS
BANKWEST OF KANSAS Goodland KS
The Citizens State Bank Grainfield KS
The Citizens National Bank Greenleaf KS
Signature Bank Haddam KS
The First National Bank of Harveyville Harveyville KS
Citizens State Bank and Trust Company Hiawatha KS
First Kansas Bank Hoisington KS
The First National Bank of Howard Howard KS
The Citizens State Bank Hugoton KS
Millennium Bank Junction City KS
The Nekoma State Bank LaCrosse KS
Leonardville State Bank Leonardville KS
The Citizens State Bank Miltonvale KS
The Montezuma State Bank Montezuma KS
The First Security Bank Overbrook KS
National Advisors Trust Company, FSB Overland Park KS
Bank of Prairie Village Prairie Village KS
Prescott State Bank Prescott KS
1st Bank of Troy Troy KS
Bluegrass Community Bank Danville KY
Hart County Bank and Trust Company Munfordville KY
Sebree Deposit Bank Sebree KY
Tri-State Bank and Trust Haughton LA
Lakeside Bank Lake Charles LA
Mutual Savings and Loan Association Metairie LA
West Carroll Community Bank Oak Grove LA
Bank of Oak Ridge Oak Ridge LA
Home Federal Bank Shreveport LA
Boston Trust & Investment Management Company Boston MA
Fidelity Management Trust Company Boston MA
Fidelity Personal Trust Company, FSB Boston MA
Mercantile Bank and Trust Company Boston MA
Bank of Cape Cod Hyannis MA
Northmark Bank North Andover MA
Nuvo Bank & Trust Company Springfield MA
Legg Mason Investment Counsel & Trust Company, N.A. Baltimore MD
T. Rowe Price Savings Bank Baltimore MD
Revere Bank Laurel MD
Ann Arbor State Bank Ann Arbor MI
Comerica Bank & Trust, N.A. Ann Arbor MI
Bank of Birmingham Birmingham MI
Auto Club Trust, FSB Dearborn MI
JPMorgan Chase Bank, Dearborn Dearborn MI
Altura State Bank Altura MN
State Bank of Bellingham Bellingham MN
American State Bank of Erskine Erskine MN
The First National Bank of Herman Herman MN
State Bank of Jeffers Jeffers MN
Vantage Bank (Formerly known as Kent State Bank) Kent MN
State Bank of Lismore Lismore MN
Liberty Savings Bank fsb Saint Cloud MN
Bank 21 Carrollton MO
Parkside Financial Bank & Trust Clayton MO
Missouri Bank and Trust Company of Kansas City Kansas City MO
Community Bank of Memphis Memphis MO
Bank of Minden Mindenmines MO
Wells Bank of Platte City Platte City MO
Midwest Federal Savings and Loan Association of St Joseph Saint Joseph MO
Edward Jones Trust Company Saint Louis MO
Scottrade Bank Saint Louis MO
TIAA-CREF Trust Company, FSB Saint Louis MO
First Federal Savings and Loan Association Aberdeen MS
The Bank of Bolivar County Shelby MS
Davidson Trust Co. Great Falls MT
Bank of Montana Missoula MT
Cedar Hill National Bank Charlotte NC
Premier Commercial Bank Greensboro NC
Coastal Bank & Trust Jacksonville NC
Mount Gilead Savings and Loan Association Mount Gilead NC
Tarboro Savings Bank, SSB Tarboro NC
Grant County State Bank Carson ND
Farmers State Bank of Crosby, N.D. Crosby ND
Heartland State Bank Edgeley ND
Sargent County Bank Forman ND
Liberty State Bank Powers Lake ND
Merchants Bank Rugby ND
Strasburg State Bank Strasburg ND
Peoples State Bank of Velva Velva ND
Peoples State Bank Westhope ND
Farmers and Merchants Bank Axtell NE
Battle Creek State Bank Battle Creek NE
Boelus State Bank Boelus NE
Citizens State Bank Carleton NE
Farmers State Bank Carroll NE
Cedar Rapids State Bank Cedar Rapids NE
Farmers State Bank Dodge NE
The First National Bank of Fairbury Fairbury NE
The Fullerton National Bank Fullerton NE
Bank of Hartington Hartington NE
The First National Bank of Holdrege Holdrege NE
Farmers State Bank Humphrey NE
Bank of Lewellen Lewellen NE
Home State Bank Louisville NE
Nebraska State Bank Lynch NE
Bank of Mead Mead NE
Farmers and Merchants Bank Milligan NE
Commercial Bank Nelson NE
Bank of Newman Grove Newman Grove NE
NebraskaLand National Bank North Platte NE
Bank of Orchard Orchard NE
First National Bank in Ord Ord NE
Nebraska State Bank Oshkosh NE
Bank of Prague Prague NE
Commercial State Bank Republican City NE
State Bank of Riverdale Riverdale NE
The American National Bank of Sidney Sidney NE
Stanton State Bank Stanton NE
The Bank of Steinauer Steinauer NE
Tri Valley Bank Talmage NE
Foundation First Bank Waterloo NE
Winside State Bank Winside NE
Sumitomo Mitsui Trust Bank (U.S.A.) Limited Hoboken NJ
Cross River Bank Teaneck NJ
Bessemer Trust Company Woodbridge NJ
DSRM National Bank Albuquerque NM
The Carlsbad National Bank Carlsbad NM
Western Bank of Clovis Clovis NM
Lea County State Bank Hobbs NM
Valley Bank of Commerce Roswell NM
Eaglemark Savings Bank Carson City NV
Credit One Bank, National Association Las Vegas NV
HSBC Bank Nevada, National Association Las Vegas NV
Berkshire Bank Municipal Bank Albany NY
Alma Bank Astoria NY
PCSB Commercial Bank Brewster NY
Greene County Commercial Bank Catskill NY
State Bank of Chittenango Chittenango NY
Fairport Savings Bank Fairport NY
Sunnyside Federal Savings and Loan Association of Irvington Irvington NY
Gold Coast Bank Islandia NY
Provident Municipal Bank Montebello NY
Flushing Commercial Bank New Hyde Park NY
Bessemer Trust Company, National Association New York NY
Delta National Bank and Trust Company New York NY
Emigrant Mercantile Bank New York NY
Mizuho Trust & Banking Co. USA New York NY
Pathfinder Commercial Bank Oswego NY
Pioneer Commercial Bank Troy NY
WSB Municipal Bank Watertown NY
The Baltic State Bank Baltic OH
Credit First National Association Brook Park OH
Brookville National Bank Brookville OH
First Federal Savings and Loan Association Centerburg OH
The Corn City State Bank Deshler OH
Community First Bank, National Association Forest OH
The Marblehead Bank Marblehead OH
Nelsonville Home and Savings Nelsonville OH
The First National Bank of Powhatan Point Powhatan Point OH
Versailles Savings and Loan Company Versailles OH
Home Savings Bank of Wapakoneta Wapakoneta OH
Community Bank Alva OK
Peoples State Bank Blair OK
Farmers & Merchants Bank Duke OK
Prime Bank Edmond OK
First State Bank Elmore City OK
First American Bank Erick OK
The First National Bank of Nash Nash OK
Great Nations Bank Norman OK
Community National Bank of Okarche Okarche OK
The First National Bank of Stigler Stigler OK
Anchor D Bank Texhoma OK
The State Bank of Wynnewood Wynnewood OK
Centerpointe Community Bank Hood River OR
American Bank Allentown PA
Manor Bank Manor PA
Gateway Bank of Pennsylvania McMurray PA
SEI Private Trust Company Oaks PA
Second Federal Savings and Loan Association of Philadelphia Philadelphia PA
The Philadelphia Trust Company Philadelphia PA
The Haverford Trust Company Radnor PA
Talbots Classics National Bank Lincoln RI
Bryant State Bank Bryant SD
Security National Bank of South Dakota Dakota Dunes SD
The Security State Bank Emery SD
Mansfield State Bank Mansfield SD
Menno State Bank Menno SD
American State Bank Oldham SD
Farmers State Bank Parkston SD
American State Bank of Pierre Pierre SD
Black Hills Community Bank, N.A. Rapid City SD
Target National Bank Sioux Falls SD
The Roberts County National Bank of Sisseton Sisseton SD
The Farmers State Bank of Turton Turton SD
Independence Trust Company Franklin TN
Nashville Bank and Trust Company Nashville TN
Liberty Capital Bank Addison TX
The First National Bank of Amherst Amherst TX
The First National Bank of Aspermont Aspermont TX
Business Bank of Texas, N.A. Austin TX
Bandera First State Bank Bandera TX
The State National Bank of Big Spring Big Spring TX
Bloomburg State Bank Bloomburg TX
Citizens National Bank Cameron TX
Capital Bank of Texas Carrizo Springs TX
Citizens Bank Claude TX
Brazos National Bank Clute TX
First National Bank of Colorado City Colorado City TX
Columbus State Bank Columbus TX
The First State Bank Columbus TX
Stockmens National Bank in Cotulla Cotulla TX
Citizens National Bank of Crosbyton Crosbyton TX
First National Bank in Dalhart Dalhart TX
First Associations Bank Dallas TX
First Private Bank of Texas Dallas TX
Grand Bank Dallas TX
Pegasus Bank Dallas TX
Texas Security Bank Dallas TX
Tolleson Private Bank Dallas TX
Amistad Bank Del Rio TX
Texas Financial Bank Eden TX
The First National Bank of Eldorado Eldorado TX
Security State Bank Farwell TX
Citizens State Bank Ganado TX
The Granger National Bank Granger TX
Gruver State Bank Gruver TX
Texas Regional Bank Harlingen TX
The First National Bank of Hico Hico TX
Houston Business Bank Houston TX
Memorial City Bank Houston TX
First State Bank Junction TX
First National Bank of Lake Jackson Lake Jackson TX
The First National Bank of Lipan Lipan TX
The Lone Star State Bank Lone Star TX
The Commercial Bank Mason TX
The Mason National Bank Mason TX
The First National Bank of Mertzon Mertzon TX
Bank of Texas Midland TX
Tejas Bank Monahans TX
The City State Bank of Palacios Palacios TX
Heritage Bank Pearland TX
Robert Lee State Bank Robert Lee TX
Peoples State Bank Rocksprings TX
R Bank Round Rock TX
The Bank of San Antonio San Antonio TX
The City National Bank of San Saba San Saba TX
Schwertner State Bank Schwertner TX
The First National Bank of Seymour Seymour TX
Commerce Bank Texas Stockdale TX
First State Bank Stratford TX
Texas National Bank Sweetwater TX
The First National Bank of Tahoka Tahoka TX
First State Bank in Tuscola Tuscola TX
Hill Bank & Trust Co. Weimar TX
POINTWEST Bank West TX
First National Bank in Whitney Whitney TX
The First National Bank of Woodsboro Woodsboro TX
Zapata National Bank Zapata TX
OptumHealth Bank, Inc. Salt Lake City UT
First Electronic Bank Sandy UT
1st Commonwealth Bank of Virginia Arlington VA
E*TRADE United Bank Arlington VA
Chain Bridge Bank, National Association McLean VA
The Trust Company of Virginia Richmond VA
Oak View National Bank Warrenton VA
Frontier Community Bank Waynesboro VA
Core Business Bank Bellevue WA
Farmington State Bank Farmington WA
Liberty Bay Bank Poulsbo WA
Collins State Bank Collins WI
Settlers Bank De Forest WI
State Bank Gresham WI
WPS Community Bank, FSB Madison WI
Marathon State Bank Marathon WI
M&I Bank of Mayville Mayville WI
Milton Savings Bank Milton WI
Northwestern Mutual Wealth Management Milwaukee WI
Palmyra State Bank Palmyra WI
Citizens Bank of Morgantown, Inc. Morgantown WV
First Federal Savings & Loan Association of Ravenswood Ravenswood WV
The Converse County Bank Douglas WY
Wyoming State Bank Laramie WY
First State Bank Wheatland WY