Supervision & Ratings
CAMELS Rating
Also known as CAMELS, CAMELS Rating System
CAMELS is the supervisory rating system examiners use to grade a bank's safety and soundness across six components (Capital, Asset quality, Management, Earnings, Liquidity, and Sensitivity to market risk) on a 1 (best) to 5 (worst) scale.
Read the full guide to the CAMELS rating system.
How is CAMELS Rating defined?
Each component is scored 1-5 and rolled into a composite, also 1-5. The official rating is confidential and assigned by examiners, who weigh Call Report data (capital ratios, asset quality, earnings, and liquidity) together with examination findings that are never published.
Why does CAMELS Rating matter?
The CAMELS composite drives supervisory consequences: deposit-insurance assessment rates, examination frequency, enforcement, and approval of expansion. A 1 or 2 is satisfactory; a 3 invites heightened supervision; 4 or 5 signals serious problems and likely enforcement action.
How do you interpret CAMELS Rating?
Because official ratings are confidential, analysts build their own scorecards from public Call Report metrics under the same six headings. BankRegReports does this with its own scoring system: it does not have any bank's CAMELS rating and does not use the regulators' methodology, so its grades are an independent read of public filings, not a copy of the examiners' rating. Read the component picture, not just a single grade: a bank can be strong on capital yet weak on earnings or liquidity, and the weakest component often drives the supervisory response.
What do CAMELS Rating levels indicate?
| Range | Label | Interpretation |
|---|---|---|
| Composite 1 | Strong | Sound in every respect; minimal supervisory concern. |
| Composite 2 | Satisfactory | Fundamentally sound with modest weaknesses. |
| Composite 3 | Watch | Weaknesses warranting heightened supervision. |
| Composite 4-5 | Concern | Serious-to-critical problems; enforcement likely. |
Worked example
Frequently asked
What do the letters in CAMELS stand for?
Capital adequacy, Asset quality, Management, Earnings, Liquidity, and Sensitivity to market risk. Each is scored 1 to 5 and combined into a composite rating.
Are CAMELS ratings public?
No. The official rating assigned by examiners is confidential supervisory information, and it also reflects examination findings that are never published. Analysts can build their own scorecard from public Call Report data, but it is a separate assessment, not the official rating.
Does BankRegReports show a bank's CAMELS rating?
No. BankRegReports does not have the FFIEC's CAMELS rating system or any bank's CAMELS rating, and does not use the regulators' rating methodology. We built our own instead: a proprietary scoring system that grades each bank on six components (capital, asset quality, management, earnings, liquidity, and sensitivity to market risk), using our own metric set drawn from public regulatory filings. Component grades reflect where a bank's ratios sit within its peer group, and our failure-risk scores come from a machine-learning model trained on the history of bank failures (an exploratory screening score, not a calibrated probability). They are not the regulators' ratings.
Sources
- FFIEC Uniform Financial Institutions Rating System (UFIRS)
- FFIEC Call Report (component data)
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