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Wednesday, November 25, 2009 - Page updated at 11:54 a.m.

Database: Analyze your bank

To create a fair sample of the nearly 100 banks and thrifts headquartered in Washington state, The Seattle Times first chose all banks whose parent companies are publicly traded and all banks that have received money through the federal Troubled Asset Relief Program. We then added a geographically diverse mix of other significant institutions, for a final total of 48 banks and three S&Ls. All data is as of Sept. 30.


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Comprehensive risk ratio: Total noncurrent and nonperforming assets (loans past due more than 30 days, nonaccrual loans, foreclosed real estate) divided by the sum of tangible equity capital and loan loss reserves.

The higher the ratio, the more exposed it is to potential credit losses.


NPA/total assets ratio: Total noncurrent and nonperforming assets, as defined above, divided by total assets. The higher the ratio, the more credit issues the bank has to deal with.


Tier 1 leverage capital ratio: Tier 1 capital is the sum of core capital components (capital stock, surplus, undivided profits, qualifying noncumulative perpetual preferred stock and minority interest in the equity accounts of consolidated subsidiaries) less intangible assets such as goodwill. The ratio divides tier 1 capital by average tangible assets. A tier 1 leverage ratio of at least 4 percent is one of the requirements for a bank to be considered "adequately capitalized" by regulators; to be deemed "well capitalized" the ratio should be 5 percent or higher.


Coverage ratio: Loan-loss allowance divided by total noncurrent and nonperforming loans (past due more than 30 days and nonaccrual). The lower the ratio, the less cushion the bank has to deal with problem assets.


Net chargeoffs, year over year: Total loans charged off less any recoveries, third-quarter 2009 versus third-quarter 2008. As the recession grinds on, most banks are showing a substantial increase in chargeoffs. Banks with blank fields had no net chargeoffs in either or both of the 2008 and 2009 periods.


Source: Seattle Times analysis of call/thrift reports and Uniform Bank Performance Reports by business reporter Drew DeSilver.

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