A lender's total loans divided by its total assets, which shows how much of its balance sheet is in loans and not in cash, securities and other holdings.
Total assets are everything a lender owns: cash, securities, loans, buildings and the rest. Loans to assets is the share of that total held as loans. A credit union with $60,000,000 of loans and $100,000,000 of assets is at 60 percent.
The ratio answers a simple question about a lender you are thinking of calling: is lending most of what it does? An institution with most of its assets in loans is an active lender for its size. One with a small share keeps more in securities and cash. That can mean it has room to add loans, or that it has chosen not to lend much. The ratio cannot tell you which, so read it with the kinds of loans the lender holds and how those balances have changed over the past year.
It is the one capacity measure that works the same way for banks and credit unions, because both report total loans and total assets. Loans to deposits is shown for banks only on this site. No rule sets a required level for this ratio.
How it shows up in the data here
Every bank and credit union page shows Loans to assets: total loans divided by total assets from the latest Call Report or NCUA Form 5300, our calculation, next to the same figure for peers. Total loans and total assets are also listed on their own. Open any lender from the lender directory or put two side by side on the compare page.
Go further
- Lender directory: Every bank, credit union and non-bank lender on file.
- Compare lenders: Put lenders side by side on the same measures.
- How to pick banks for a deal with public data: Public filings cannot tell you which bank will say yes. They can tell you which banks are large enough, already hold loans like yours and lend where the property is. That is enough to turn four thousand banks into six phone calls.
- How to read a bank call report as a loan searcher: Every bank files a call report each quarter. One schedule in it lists the bank's loans by kind. Read that schedule and you know what the bank holds. You still do not know what it made last quarter.
- How to read a credit union's 5300 call report: Credit unions file their own call report, NCUA Form 5300, every quarter. For commercial loans it says more than a bank's report does: it counts the loans, and it reports what was made during the year.
Related terms
- Loan-to-deposit ratio: A lender's total loans divided by its total deposits, which shows how much of the money customers keep with it is already lent out.
- Call report: The financial report every bank and savings association files with its federal regulator each quarter, with a balance sheet, an income statement and schedules that break out loans by kind.
- NCUA 5300 call report: The financial report every natural person credit union files with NCUA each quarter. It is the public source for what a credit union lends and holds.
- Net worth ratio: A credit union's net worth divided by its total assets, as a percentage. NCUA treats 7 percent or more as well capitalized and 6 percent as adequately capitalized.
- Tier 1 capital: A bank's core capital under the capital rule: common equity tier 1 plus additional tier 1. The minimums are 6 percent of risk-weighted assets and a 4 percent leverage ratio.
Sources
Plain definitions for orientation, not legal, tax or credit advice. A lender's own policy decides what it will do.