Ratings Rise For Miamibased Banks
Written by Scott Blake on September 27, 2012
By Scott Blake
Greater Miami’s hometown banks are gaining financial strength with the local real estate market, faring better in the last quarter than Florida banks as a whole, according to market research released Tuesday.
Among 38 banks based in Miami-Dade County, 17 banks — 44.7% — received recommended ratings of four stars or five stars from BauerFinancial Inc., a bank ratings firm in Coral Gables.
That was well above the 32.9% of banks statewide that received recommended ratings from Bauer for the second quarter, ended June 30.
In addition, the level of troubled or problematic local banks in Greater Miami (34.2%, or 13 of 38) was slightly lower than the level of banks throughout Florida (38%) that received ratings of two stars or less, according to data Bauer provided to Miami Today.
"The South Florida banks are doing better than they were two years ago," said Karen Dorway, Bauer’s president and director of research.
She attributed the improvements to the firming up of South Florida’s real estate market, which hurt many banks, causing some to fail when the market crashed several years ago, followed by a slow recovery.
Despite the overall strengthening of Greater Miami’s hometown banks, they still have a long way to go, Ms. Dorway said. She noted that South Florida banks, as a group, are still behind banks nationwide in the ratings.
Across the US, for example, 66.6% of banks received recommended ratings in the second quarter, while only 10.5% were rated as troubled or problematic.
"That’s a number we haven’t seen since March 2008," Bauer said in a statement. "Capital levels and profits are on the rise and delinquent loans are finally on the mend, settiang the stage for this good news.
"Perhaps even better news," the firm added, "the percentage of US credit unions that have earned a recommended rating… has reached a milestone as it now tops 75%."
Ms. Dorway said the lower overall ratings by Florida banks are largely due to the severe collapse of state’s housing market, which was among the worst in the nation. Although the Florida market has been recovering to some degree, it still has more weak spots than most markets nationwide.
Overall, five local banks improved their ratings in the second quarter and three banks saw their ratings drop.
The top local stars of the Bauer report were Miami-based Apollo Bank, a relatively new community bank in Brickell that saw its rating rise to five stars in the second quarter from four stars in the first quarter.
Others earning five-star ratings were BankUnited of Miami Lakes, which maintained its five-star rating from the previous quarter; Miami-based City National Bank of Florida, which also maintained its five-star rating; Espirito Santo Bank in Miami, which raised its rating to five stars from four stars; Miami-based Executive National Bank, which raised its rating to five stars from four stars; Intercontinental Bank of West Miami, which maintained a five-star rating; Sabadell United Bank in Miami, which maintained its five star rating; and Miami-based TotalBank, which also maintained its five-star rating.
Local banks that fell into the troubled or problematic category were: Coral Gables-based Bank of Coral Gables (one star); Homestead-based Community Bank of Florida (two stars); Miami-based Eastern National Bank (two stars); Coral Gables-based Eurobank (two stars); Coral Gables-based First Bank of Miami (two stars); Coral Gables-based Gibraltar Private Bank & Trust (two stars); Miami-based Great Eastern Bank of Florida (two stars); Miami-based Great Florida Bank (zero stars); Miami-based InterAmerican Bank (two stars); Miami-based Intercredit Bank (two stars); Miami-based International Finance Bank (one star); Miami-based Ocean Bank (one star); and Doral-based US Century Bank (zero stars).
Miami-Dade County’s seven largest banks, regardless of where they are based, all fared well in the second quarter, either maintaining or improving their ratings, the report shows.
In order of local market share of deposits: Wells Fargo Bank maintained its three and a half-star rating; Bank of America raised its rating to three and a half stars from three stars; Citibank maintained its four-star rating; SunTrust Bank raised its rating to three and a half stars from three stars; Mercantil CommerceBank raised its rating to three and a half stars from three stars; JP Morgan Chase Bank maintained its three and a half-star rating; and Regions Bank maintained its three and a half-star rating.To read the entire issue of Miami Today online, subscribe to e -Miami Today, an exact digital replica of the printed edition.