How to Check for a Bank's Credit Rating

When a consumer looks to open a checking account, they don’t always think to look into the bank’s history. When that some consumer decides to open a savings account with a substantial balance, it is wise to do a little research. One way to find out if the bank you are going to be doing business with is sound is to check the bank’s credit rating. Although the FDIC does not release their ratings to the public, they do recommend several sites that consumers can use to check for a bank’s credit rating.

Difficulty: Moderate

Instructions

1. Open your web browser and go to the Bankrate Safe & Sound Ratings website. Bankrate looks at a variety of statistics for each financial institution including the bank’s asset quality, profitability and liquidity.

2. Select whether the financial institution that you are researching is a credit union or a bank/thrift. Click the “Next” button to continue. Enter the search options to locate your financial institution. You can search by the bank’s name, state, zip code, asset size or rating. This is useful if you do not have a specific bank in mind as well as if you want to check the status of your current bank. Click “Next” after selecting your search option.

3. Choose your bank from the list of financial institutions provided in the drop-down menu and click on “Next.” View the Bankrate.com Star Rating and the Safe & Sound CAEL Rating. Star ratings start at one star which is the lowest rating and go up to five stars which is a superior rating. The CAEL ratings are the opposite with a CAEL rating of one being the highest possible and a five being the lowest possible.

4. Choose to review any reports of financial summaries that Bankrate has from your financial institution. Now that you have looked at how Bankrate scores your bank, you should look at another rating system. It is a good idea to use two different models to ensure that there isn’t a large discrepancy between the two.

5. Open the Bauer Financial Banks and Credit Unions rating page. You will need to choose whether you are looking for information on a bank or credit union.

6. Select the state that were the financial institution is located as well as the name of the financial institution. Click on “Search” for your results. Find your bank on the results page and click on the “Tell Me More” button.

7. Review the Star Rating that Bauer Financial has assigned to your bank. Bauer Financial recommends all four and five-star banks to their readers. If you are interested in purchasing a more in-depth report on your bank’s credit rating, you can do so from this screen.

8. Compare the ratings from Bankrate and Bauer Financial. If they are similar (they don’t need to be identical) then you can be reasonably assured that the bank’s credit rating is indeed a positive one.

Tips & Warnings

• For more companies offering data on a bank’s credit rating, visit the FDIC’s Bank Rating Services website.

Resources

• Bankrate Safe & Sound Ratings
• auer Financial Banks and Credit Unions Ratings
• FDIC Bank Rating Services

[johnjohnsonbde]

on 11/27/2009 Great article 5 stars for that information

While I was looking for credit report sites I found one great site that offer you free credit report, credit monitoring, fraud alerts, and option for increase your credit score.I've increased my credit score with 90...I though that I should share it here.Here it is:

http://www.CreditReportFrees.Info

[simplelife]

on 10/27/2008 This is a much needed piece of advice in today's economy. Thank you for the information!

[Foto45steve]

on 10/27/2008 Thanks, it is nice to know the banks have credit scores just as they assign all of us one too!

[Greatfunmoms]

on 10/25/2008 Good article!

[iamageniuster]

on 10/25/2008 Excellent article. 5 stars. Thanks for sharing.