Overview of Sugar River Bank

Sugar River Bank was established in 1895 and is one of a select number of banks in the country that have existed for over a century. Its main office is located in the state of New Hampshire in the city of Newport. New Hampshire is home to 17 banks that collectively have $14,812 million of assets outstanding. The bank first got insured by the Federal Deposit Insurance Corporation in the year 1959 and has remained insured by the independent agency ever since. In addition, the FDIC is the primary federal regulator for the bank and is focused on supervising and examining the bank for operational safety and soundness. Mainly because of its relative size, geographic reach and presence, the bank is considered to be a community bank, instead of a national bank. Based on our estimates, we believe its asset base of $371 million ranks it in the 60th percentile of banks in the United States. Sugar River Bank is primarily a domestic bank and does not at the current time have operations outside of the United States. Domestically, the bank currently has 6 offices. Finally, the bank currently has a total employee base of 71 people.

Discussion of the key components of the Bank’s Balance Sheet

As noted earlier, the bank has total assets of $371 million. In addition, the bank has a deposit base of $318 million and net loans outstanding of $224 million. Overall, 40% of the bank’s deposits outstanding were transactional deposits. Transactional accounts are accounts like checking accounts which will tend to have more volatile balances. From an operational standpoint non-transactional accounts are more stable and attractive. In terms of the location of depositors, domestic depositors made up 100% of the bank’s total deposit base. Within this, 87% of the domestic deposits outstanding are insured. Moving on to the components of the bank’s assets we can see that loans provided to customers represent 61% of the banks total assets. Of this amount, loans related to real estate activities comprised 88% of gross loans outstanding. Sugar River Bank has $157 million of outstanding 1-4 family residential loans (mortgages), which in total represents 69% of its loans outstanding. Loans to individuals and loans to commercial and industrial interests represent 3% and 7% of loans outstanding, respectively.

Contact Information and Other Facts For Sugar River Bank

  • Main Office Address: 10 N Main St, Newport, NH 3773
  • Website: www.sugarriverbank.com
  • Total Number of Branches: 6
  • Total Number of International Branches: None
  • Number of Employees: 71
  • FDIC Certificate Number: 18028
  • FDIC Community Bank: Yes
  • FDIC Field Office: Concord
  • Independent or Subsidiary Bank: Independent
  • Federal Reserve ID Number: 92706
  • Bank Charter Class: SB
  • Primary Regulator: FDIC

Financial Overview

sugar river bank-financial-metrics-sept-21

Sugar River Bank has total assets of $371 million which compares with $338 million in the prior year. This implies that over the past year, the bank’s asset base has shown an increase of 9.8%. Moving to the other side of the balance sheet, we see net loans of $224 million which compares with $217 million in the prior year. Therefore its clear that over the past year the bank’s net loans outstanding has reported an increase of 3.1%. Taking a closer look at the bank’s loan portfolio, we see that residential mortgages, which make up the majority of the bank’s lending activities comprise 69% of the bank’s loan book. The bank has $157 million of residential mortgages outstanding, which compares with $150 million in the prior year. This implies an increase of 4.9% over the past year. In addition, the bank provides loans to commercial and industrial businesses, which represents 7.2% of its total lending and stood at $16 million based on the latest available information. The bank also provides loans for farm-related activities, which currently amounts to 0.0% of its total loan portfolio. Finally, the bank also engages in the provision of auto loans. These are loans provided to customers to help finance vehicle purchases. Auto loans represent 0.0% of the bank’s total lending.

Bank Liquidity and Funding

How a bank funds its activities is an important area to assess and monitor. As a depositor you want to make sure the bank is conservatively funded, and the same goes for customers. Oftentimes one of the cheapest forms of funding is customer deposits. Sugar River Bank has total customer deposits outstanding of $318 million. The bank’s deposit base has increased substantially over the past year, growing 14.2%. The average bank in the country has a loan to deposit ratio of approximately 82%. In comparison, Sugar River Bank has a loan to deposit ratio of 70% which is well below the average. A lower ratio is generally better as it indicates that the lending activities of a bank are more comfortably covered by its deposit base. Deposits, as noted earlier, are usually a cost effective source of financing. All of the bank’s deposits are sourced from domestic depositors, which is helpful from a risk assessment standpoint.

Bank Performance and Capital Metrics

sugar river bank-performance-metrics-sept-21

Moving on to the performance and capital metrics for the bank, in the above we have a chart that shows key performance metrics for Sugar River Bank compared with the average U.S. bank. When it comes to the bank’s return on assets, over the past year it has declined. Importantly, on this metric we can also see that the bank is below the average bank. Return on assets tells us how productive a bank is being with its asset base. Next, looking at the bank’s return on equity, which tells us how much of a return the bank has generated for its owners, over the past year it has declined. In addition, we can also see that the bank is below the average bank on this metric. The bank’s total leverage ratio has declined over the past year and is currently above the national average. Finally, we could not find Sugar River Bank’s risk-weighted asset information for this period and therefore had to make some assumptions and estimates. We estimate that the bank had a tier 1 capital ratio of 21.3% which is above the average U.S. bank.

Conclusion: Sugar River Bank

Our final rating for Sugar River Bank, after assessing the bank on several important metrics, is 3.1 out of 5.0, which is above average. Specifically, an area of strength for the bank would be its cost of funds which is above the national average. On the contrary, the bank’s net interest margin is one of the primary drawbacks on its rating as on this metric, the bank is below average. As a reminder, our rating is based on our proprietary scoring system which uses data from an in-depth nationwide bank study we performed. None of the work presented is intended to be investment advice or advice of any sort and is presented purely for informational purposes.