Many institutions rely on IDC Financial Publishing (IDCFP) CAMEL rankings to do business. This includes financial institutions that buy and sell brokered CDs, insurance companies, state and local governments, federal agencies, private companies, as well as individual banks, savings institutions and credit unions.
Brokers trading certificates of deposit, registered investment advisors buying CDs, and firms assisting financial institutions in raising deposits, use IDCFP’s CAMEL ranks to assess the quality of banks issuing brokered CDs. State and local governments, determining the amount of assets to secure their bank deposits, rely on IDCFP rating services to measure the safety and soundness of financial institutions. Federal agencies use IDCFP ranks to determine credit worthiness. Private companies selling products to financial institutions determine potential for risk by using our institution ratings. Finally, individual banks, savings institutions and credit unions rely on our CAMEL analysis when evaluating their own strength, as well as for inter-bank lending.
Our Rating Standard
IDCFP calculates a one-number summary rank, based on an analysis of 24 financial ratios. Ratings range from 1, the lowest, to 300, the top grade attainable. The result is a quick, at-a-glance financial strength assessment that promotes direct and straightforward comparisons between any bank, savings institution, or credit union.
We give you the ability to determine why things are going well...or not so well. For those looking for more than a rating, we also provide the financial ratios used to calculate a rank number. These ratios explain the financial institution's strengths and weaknesses and ultimately their impact on the final rank. IDCFP provides you the ability to not only calculate a rank, but to view the ratios used and the weight applied to the ratios in computing the rank score.
As a bank rating service, IDCFP also provides a unique comparison of subsidiary bank ratings, which we list with the parent holding company and its rank. This allows the subscriber to view the quality and strength of the parent holding company relative to the bank subsidiaries.
Our Remarkable Track Record
In the early 1990’s, and again in the banking crisis of 2008-2009, institutions using IDCFP ranks determined that ratings lower than 125 were deemed below investment grade. For example, buyers or holders of brokered CDs required an IDCFP rank of 125 or higher for an issuing bank.
Regarding the timeliness of IDCFP’s bank ratings, The Washington Department of Financial Institutions has listed on their website “IDC has a remarkable track record of identifying deteriorating or improving performance months, and sometimes years before it becomes apparent to other ranking companies.” From 1990 to 2018, there were 1,419 failures of banks. Of these, 90% (1,271 banks) were ranked less than 125 by IDCFP up to 17 months before failure. Further, 73% (1,033 banks) were rated less than 125 by IDCFP up to 29 months before a collapse.
Our Online Portal Features
Bank, Savings Institution, and Credit Union ratings and supporting financial ratios are all accessible through IDCFP’s online portal. The portal contains a number of features to access rating history for a single bank or group of institutions. Users can search by CD CUSIP number, by institution name, or by location, and have the ability to sort by peer groups or by region of the country. Users can also create customized watch lists on the portal.
IDCFP also offers specialized rating services to subscribers and access to our qualified analysts when questions arise concerning ratings or methodology. The subscriber may know of unique circumstances for an institution that are not reflected in the standard regulatory reporting, conditions which could change the financial ratios and rating of the institution in that particular situation.
John E Rickmeier, CFA, President, firstname.lastname@example.org
Robin Rickmeier, Marketing Director