Mutualbanks convert to stock form for myriad reasons, one of the most important beingto increase safety and soundness through elevated capital ratios. A handful of mutualsalready boast bulging capital ratios, not only removing an incentive to go publicbut making a full conversion a longshot.
As ofMarch 31, of the 335 mutual banks with greater than $100 million in total assets,31 had a tangible common equity-to-tangible assets ratio above 20%.
This analysis excludes publicmutual holding companies, subsidiaries of insurance companies and companies thatare not the largest banking entity within a mutual corporate structure that containsmultiple entities.
Withinthat mutual universe, Middletown, N.Y.-based First Federal Savings of Middletown has the highest tangiblecapital ratio, at 36%. The company stands out in other financial metrics as well.It is the only one in that group with more than half of its asset base comprisedof cash and cash equivalents. Its loans-to-deposits ratio of 16% ranks second-lowestamong the mutuals, and its five-year total asset change of -17% is ninth-lowest.
Click here for a webinar on mutual bank conversions. Click here to download a template showing the conversion pipeline, market performance of recent conversions, the valuations of mutual holding companies, and the market and financial performance of current public thrifts. For a refreshable Excel template with a snapshot of key performance metrics and financials of any regulatory depository institution, click here. On the news side, click here for more conversion features. |