S&P Global Market Intelligence has released its annual rankings of 2020’s top-performing banks in three categories: community banks with assets between $3 billion and $10 billion, community banks with assets less than $3 billion, and top-performing credit unions.
Sioux Falls, S.D.-based United National Corp., the holding company of Premier Bankcard LLC and First Premier Bank, took the crown in S&P Global Market Intelligence's ranking of the best-performing large U.S. community banks in 2020.
United National rode its credit card-heavy portfolio to the top of the ranking, posting the highest net interest margin among the top 50 banks at 18.84% in 2020. Its 33.63% return on average tangible common equity was nearly double the top 50 median as well. As might be expected for a bank with significant exposure to credit cards, United National's nonperforming assets to totals assets ratio, net of PPP loans, was the third-highest among the top 50 at 1.71% in 2020.
Laurel, Mont.-based Yellowstone Bank topped S&P Global Market Intelligence's 2020 ranking of the best-performing U.S. community banks under $3 billion in assets.
The century-old bank operates eight brick-and-mortar branches and one facility branch across six cities in Montana. The bank had a strong 2020, powered by a 20% increase in assets and a nearly 29% jump in net income, all while maintaining a 36.7% efficiency ratio and zero nonperforming assets or loans 90-plus days past due as of Dec. 31, 2020.
To compile these ranking, S&P Global Market Intelligence calculated scores for each company based on six metrics, weighted: pre-tax return on tangible common equity (25%), efficiency ratio (15%), net interest margin (15%), operating revenue growth (20%), leverage ratio (15%), and nonperforming assets and loans 90 days past due as a percentage of totals assets, net of Paycheck Protection Program loans (10%). Each company's standard deviation from the industry mean was calculated for every ranking metric, then combined to derive a performance score. To help normalize the data and mitigate the impact of outliers, caps and floors were applied for each metric.
Philadelphia-based Police and Fire FCU topped S&P Global Market Intelligence's ranking of the top 100 U.S. credit unions in 2020, surpassing runners-up from Tennessee and California. The credit union not only outperformed the industry median in all five of the ranking metrics in 2020 but also outpaced the top-100 median in all but one metric. Its average loans per member of $11,260, although an improvement of 18.2% year over year, was lower than the top-100 median of $12,015.
To compile this ranking, S&P Global Market Intelligence calculated scores for each company based on five metrics, member growth, average loans, net of Paycheck Protection Program loans, per member; net worth as a percentage of total assets; delinquent loans as a percentage of total loans, net of PPP loans and return on average assets. Each company's standard deviation from the industry mean was calculated for every ranking metric, then combined to derive a performance score. To help normalize the data and mitigate the impact of outliers, caps and floors were applied for each metric.
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