A Report On The Bank's Roe

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in the 91st and 90th percentile respectively in the peer group. Figure 13 shows the peaks and valleys of the Bank’s ROE over the course of the previous five years. Figure 13 shows the upward momentum of the Bank’s ROE from 2011 through 2014 with a downturn in 2015. The 2015 downturn is contributed to the overhead costs of the bank acquisition activity. Expect to see an uptick at year end due to recoveries gained from the acquisitions. The 9/30/2015 UBPR reports the Bank’s securities to assets represent 11.10%, compared to peers at 18.50%. The Bank’s securities to assets have been consistent over the previous five years. The portfolio is mostly made up of 4.30% US Treasury and Agency Securities, 38.50% Municipal Securities and 50.62% Mortgage Backed Securities. The portfolio has little interest rate risk and as a result, the Bank’s yields have remained high. Figure 14 reflects the banks exceptional returns on its securities portfolio at 2.78% which is higher than all peer group members. FirstBank’s efficiency ratio has remained one of its Achilles heels. Efficiency ratio is a large focus at management level and steadily dropped from $76.77% in 2011 to 68.25% in 2014. The Bank experienced an increase to 73.91% in 2015 due to bank acquisition activity, adding staff and cost of funds. However, the Bank expects staffing to level out and cost of funds to decrease due to FHLB payoffs. The Bank’s current key strengths are strong loan growth, the local housing
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