Why does the health of your bank matter?

BankProv received an A+ deposit rating from DepositAccounts.com for Q1 of 2021. But what does that rating mean as a consumer and how can it help in choosing a bank?

When it comes to choosing a bank to deposit your money with, you want to know the bank is safe and stable in the event of a financial crisis. To give consumers insight into the health and stability of a financial institution, grades are issued by regulatory bodies, such as the Federal Deposit Insurance Corporation (FDIC), and credit rating agencies like DepositAccounts by Lending Tree.

The global financial crisis of 2008 prompted people to take a second look at the health of their financial institutions. Many banks and credit unions were not as financially healthy as many believed. Many consumers assume that because their accounts are protected by the FDIC, there’s nothing to worry about – even if the financial institution fails. However, the FDIC covers up only to their maximum insured limit of $250,000 per depositor. BankProv is a member of both the FDIC and the Depositors Insurance Fund (DIF), allowing us to insure deposits for our clients exceeding that FDIC limit. You can read more about what DIF is in our blog post, “What’s DIF? What it means to be fully insured.” But the health and safety of BankProv, is more than just our deposit insurance.

How are rates calculated and how does BankProv stack up?

Texas Ratio

The Texas Ratio is an indicator of how much capital a bank has available compared to the total value of loans considered at risk. At-risk loans are any loans that are more than 90 days past due and are not backed by the government.

The Texas Ratio for BankProv decreased dramatically from 13.33% as of March 31, 2020, to 3.59% as of March 31, 2021, resulting in a positive change of 73.03%. This indicates that the balance sheet and financial strength for BankProv has improved dramatically in recent periods.

Deposit Growth

Another way of calculating a bank’s health is with its deposit growth. When people put money in a bank, it’s an indicator of confidence. It also increases the money that a bank has on hand and can help strengthen the balance sheet of the bank. You can look to see the total deposits that a bank has and look to see whether they have been increasing over time.

A strong track record of growth is an indicator of consumer confidence and thus, the bank's ability to strengthen its balance sheet. The growth BankProv has shown is excellent.


Another quick, at-a-glance indicator of bank financial health is its available capital. You can figure available capital with a direct calculation of an institution’s assets minus its liabilities. Stronger capital means that more assets are available to cover potential losses.

Both the FDIC and the National Credit Union Administration (NCUA) consider capitalization levels of banks and credit unions to be of high importance. Higher capitalization allows for a greater buffer when covering loans that may fail in the future.

Read our full health grade at depositaccounts.com.

After nearly 200 years in the business, BankProv exists today as the 10th oldest bank in the country and we pride ourselves on our ability to help prepare our clients for the future.

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