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Bank Ratings

betaguy
  |     |   180 posts since 2022

Any other recommendations for a bank rating agency other than Weiss or Bauer?

I find between Weiss, Bauer and DA all kinds of discrepancies.

Thanks

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4


Answers
Vernazza
  |     |   31 posts since 2022
Freddie Mac uses the following ratings to rate over 9,000 banks and credit unions across the United States. Ranked by total assets, with over $3.3 trillion, Freddie Mac is one of the largest financial companies in the United States and top 5 in the world. Freddie Mac's depository institutions must maintain at a minimum the below risk threshold ratings:

Be rated as “well capitalized” by its federal or State regulator; and
Have a financial rating that meets at least one of the following criteria:

Institutions with assets of $30 billion or more must have either
A short-term issuer rating by S&P of “A-3” (or better) or, if no short-term issuer rating is available by S&P, a long-term issuer rating of “BBB-” (or better) by S&P; or A short-term bank deposit rating by Moody’s of “P-3” (or better) or, if no short-term bank deposit rating is available by Moody’s, a long-term bank deposit rating of “Baa3” (or better) by Moody’s

Institutions with assets of less than $30 billion must have either a:
125 (or better) Bank safety rating issued by IDC Financial Publishing, Inc.; or
C+ (or better) KBRA Financial Intelligence (KFI) Score issued by Kroll Bond Rating Agency, LLC
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5
JINAYAKO
  |     |   26 posts since 2022
Keep in mind there are different ways to judge a bank. One way to look at the amount of Assets a bank has.. Others will judge on how much Debt the bank carries.In other words beauty is in the eyes of the beholder. One way is to check out what is the rating of a bank is to see the ratings of its bonds when it goes in the Bond Market to borrow money eg BBB etc.I believe this rating is done by S & P.
For example, no a days one can NOT get a good interest rate with a Bank CD after 18 months. So for the last 3 years, I am forced to take more RISK if I want to get a higher interest rate by increasing duration and either buy Corporate Bonds OR just invest money in Mutual Funds or ETFs with a Broker like Fidelity to lock in higher Rates for longer well knowing that the Feds are going to cut Rates..But you do NOT have FDIC Insurance.
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