Invictus Rating and Important Metrics

After running our ICAM™ and LoanLayering™ models on 7000+ FDIC-insured banks, we produce a set of ratings, ratios and metrics to provide quick assessments on all banks:

Invictus Rating
Invictus Sustainability Score
Invictus Ratios
Invictus Acquisition Gauge


Invictus Rating

Our projection of Tier 1 capital for all banks enables us to place each bank into one of three rating groups:

Unconstrained: Banks that report adequate capital now and retain adequate capital after our 2-year stress simulation

Constrained: Banks that either have insufficient capital now and are relying on earnings to build capital above the regulatory minimum, or banks that have sufficient capital now but after stress will have insufficient capital.

Unsustainable: Banks that have now and will continue to have insufficient capital

Regulators will be concerned with banks in Constrained and Unsustainable groups. Banks will be concerned if they find themselves in an unexpected group. Insurers can price their D&O coverage taking into account the risk of capital shortfall. Corporate Treasurers will want to know that their banks are in the Unconstrained group from a risk mitigation point of view.

Banks in the Unconstrained group are further delineated by a qualifier (A -D) based on the Invictus Ratios.

Invictus Sustainability Score

The Invictus Sustainability Score is a simple measure of the post-stress leverage ratio base on the Adverse stress scenario. This metric gives a quick assessment of sustainability for Regulators, Insurers and other interested parties.

Invictus Ratios

Invictus produces several ratios to help in comparative analysis of banks. These ratios facilitate individual and relative analysis of bank capital adequacy and pro forma performance.

As such, the ratios:

  • Rank banks based on operational efficiency;
  • Identify banks with excess capital that they are not "putting to work";
  • Highlight banks with poor earnings relative to their asset base.

The Invictus Ratios provide quick ways of highlighting banks of particular characteristics -- essential for Bank Investors performing M&A analysis.

Invictus Acquisition Gauge

Invictus looks at each bank's capital and earnings under stress to decide upon the attractiveness (or necessity) of each bank to acquire another bank, or to sell itself. Hence banks are delineated

  • Must Buy,
  • Should Buy,
  • Must Sell,
  • Should Sell, or
  • No Action Necessary.

Full information on this analysis is in our Buyers and Bleeders report.

Invictus can perform custom analysis on this data, for example finding banks with a particular Acquisition Gauge within a particular geographic area. This analysis can give banks an early short-list of acquisition prospects, either as a buyer or a seller. The next step would be to perform a combined portfolio stress test using public data. Please contact us to discuss your requirements.