Waypoint Bank: Overview of the bank

Waypoint Bank was established in 1883 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 Nebraska in the city of Cozad. Nebraska is home to 156 banks that collectively have $89,350 million of assets outstanding. The Federal Deposit Insurance Corporation provides insurance for the bank, in addition to providing insurance to almost 5,000 other institutions in the United States. Generally speaking, the FDIC provides insurance coverage of up to $250,000 per depositor, per insured bank and for each account ownership category. Waypoint Bank has been insured by the FDIC since 1934 which is the year after the FDIC was created by the 1933 Banking Act. The FDIC is also serves as the primary federal regulator for the bank. 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 $356 million ranks it in the 50th percentile of banks in the United States. Waypoint Bank is essentially a purely domestic bank from an operational standpoint. This is because the bank does not have offices outside of the United States. Within the U.S. the bank currently has 7 offices, all of which are located across multiple states in the country. Finally, the bank currently has a total employee base of 53 people.

Overview of the Bank’s Assets and Liabilities

As noted earlier, the bank has total assets of $356 million. In addition, the bank has a deposit base of $307 million and net loans outstanding of $216 million. In total, 86% of the bank’s total assets are made up of domestic deposits, and domestic deposits also represent 100% of the bank’s deposit base. Overall, 71% of the bank’s domestic deposits are insured. As we look at the composition of the banks assets, as noted earlier the bank is primarily engaged in providing farm-related loans and commercial & industrial loans to its customers. Overall, customer loans currently make up 62% of the bank’s total assets. Waypoint Bank has $6 million of outstanding 1-4 family residential loans (mortgages), which in total represents 3% of its loans outstanding. Loans to individuals and loans to commercial and industrial interests represent 2% and 9% of loans outstanding, respectively. Loans to farmland and farms represents 33% of loans outstanding.

Contact Information For Waypoint Bank

  • Main Office Address: 747 Meridian, Cozad, NE 69130
  • Website: http://www.waypointbank.com
  • Total Number of Branches: 7
  • Total Number of International Branches: None
  • Number of Employees: 53
  • FDIC Certificate Number: 5394
  • FDIC Community Bank: Yes
  • FDIC Field Office: Grand Island
  • Independent or Subsidiary Bank: Independent
  • Federal Reserve ID Number: 244158
  • Bank Charter Class: NM
  • Primary Regulator: FDIC

Financial Overview

waypoint bank-financial-metrics-sept-21

Waypoint Bank has total assets of $356 million and over the past year its asset base has increased substantially, reporting an increase of 16.2%. In terms of the bank’s lending activities, net loans represented 60.5% of its total assets, and stood at $216 million. The bank’s loan portfolio has increased over the past year, with an increase of 4.5%. Taking a closer look at the bank’s loan portfolio, we see that residential mortgages comprise 3% of the bank’s loan book. The bank has $6 million of residential mortgages outstanding, which compares with $5 million in the prior year. This implies an increase of 20.3% over the past year. In addition, the bank provides loans to commercial and industrial businesses, which represents 8.6% of its total lending and stood at $19 million based on the latest available information. The bank also provides loans for farm-related activities, which currently amounts to 32.7% 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 1.4% 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. A large and growing deposit base is usually a good sign for a bank’s liquidity and funding. This is because customer deposits are often a cheap source of financing as many of those accounts do not pay interest or much interest. Looking at Waypoint Bank, they have total customer deposits of $307 million which over the past year has registered an increase of 21.5%. In addition, the bank has a loan to deposit ratio of 70%, which is well below the average of banks in the United States. The average in the United States is approximately 82% and as a reminder, a lower ratio indicates greater liquidity. Effectively all of the bank’s deposit base is funded by domestic sources.

Bank Performance and Capital Metrics

waypoint bank-performance-metrics-sept-21

The above chart provides a brief summary of some of the key performance metrics for Waypoint Bank. Next to these metrics are the equivalent for the average U.S. bank. As a starting point, looking at the bank’s return on assets, over the past year it has improved. Importantly, on this metric we can also see that the bank is above 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 improved. In addition, we can also see that the bank is above the average bank on this metric. The bank’s total leverage ratio has declined over the past year and is currently below the national average. Finally, Waypoint Bank’s Tier 1 capital ratio has been relatively stable over the past year. On this metric the bank is below the national average.

Conclusion: Waypoint Bank

Ultimately, after considering all of the relevant factors we rate Waypoint Bank 4.1 out of 5.0, which is exceptional. There are many factors that go into the calculation of our rating and almost all banks will have both positive and negative contributors. As an example, Waypoint Bank scores well on its net interest margin, which is above the national average. However when we consider the bank’s tier 1 capital, the bank does not have a good score mainly because it is below the national average which impacts its rating. 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.