BankAtlas
U.S. Bank Equity Indices
Index Methodology

BankAtlas Equity Indices — Index Methodology

Version 1.0 · Total returns and weighting inputs sourced from a third-party market-data vendor; free-float adjustment and a $1M/day ADV liquidity screen active.
Status: backtested — prospective tracking scheduled to begin 30 September 2026. Research benchmark; all history prior to that date is backtested (simulated).

1 · Introduction & purpose

The BankAtlas Equity Indices are a family of rules-based, quarterly-reconstituted total-return equity benchmarks that express BankAtlas's proprietary bank-risk signals — the proprietary AUC composite grade, the Run-Vulnerability Index (RVI), the five category grades, and a set of exposure and geographic baskets — as systematic bank-equity benchmarks.

The family answers a single question in benchmark form: does sorting U.S. banks on our proprietary risk signals separate equity outcomes? Every index is constructed with the same institutional discipline (point-in-time universe, published-vintage reconstitution, turnover control, delisting-return handling) so that the resulting series are analytical instruments, not marketing artifacts. The indices are rules-based analytical benchmarks designed to reflect BankAtlas's proprietary risk signals; they are not investment advice, an offer, or a promoted investment strategy.

2 · The index family

Eighteen indices across four tiers (36 total series — every index publishes two weighting classes: Equal-Weight and Capped Float-Market-Cap).

TierIndexSelection rule
FlagshipGrade (A/B) · Prime Grade (A) · Resilience · Fragility · Distressed Grade (D/E) · VulnerabilityGrade band (A/B; A only; D/E) or RVI quintile (lowest = Resilience, highest = Vulnerability); Fragility = highest-quintile troubled-loans + AFS/HTM MTM losses / assets
Category gradeAsset Quality · Earnings · Capital Strength · Liquidity · Concentration DisciplineTop-tercile category score
ExposureCRE-Exposure · NDFI-ExposureHighest-quintile CRE/equity or NDFI/loans
GeographicNortheast · Southeast · Midwest · Texas & Southwest · WestHQ-state region membership

Weak-scoring indices (Fragility, Distressed Grade, Vulnerability) publish index levels and statistics in full; current constituent lists, once prospective tracking begins, will not be displayed publicly for these indices, and constituent data may be made available under institutional license. Exposure and geographic indices are characteristic baskets, not quality grades.

3 · Eligible universe

4 · Data inputs & sources

Grades, category grades, RVI, and exposure metrics derive from FFIEC Call Report / UBPR regulatory filings, computed once by the BankAtlas rating engine and consumed by the index engine without discretionary override. Equity total returns (dividend-reinvested total-return index level), market capitalization, free-float %, and average daily value are sourced from a third-party market-data vendor; delisted names are sourced explicitly.

5 · Selection methodology

Membership, not tilt. Each index holds a defined set of constituents (grade band or top/bottom quantile); it does not scale every name by a score.

Reporting lag (no look-ahead). Call-report data for quarter Q is not published until ~35–45 days after quarter-end. Each reconstitution uses the most recent vintage published as of the reconstitution date — a 3-month lag. No index selects on information that was not public as of the applicable reconstitution date.

Hysteresis buffer (turnover control). Membership uses a narrower add band and a wider keep band (e.g., Grade A/B adds at ≥ B, keeps at ≥ C; Prime Grade A adds at A, keeps at ≥ B; Resilience adds at ≤ 20th-pct RVI, keeps at ≤ 35th). A minimum of 10 constituents is required to strike an index.

6 · Weighting

Equal-Weight (EW) — every constituent equally weighted at reconstitution; the purest expression of the selection signal and the headline class. Capped Float-Market-Cap (MCap) — market-cap weighted with an iterative 15% single-name cap; the market-cap-weighted class designed to improve replicability. Weights drift between reconstitutions and reset each quarter.

7 · Reconstitution & rebalancing

Quarterly (March / June / September / December). Reconstitution (membership) and reweighting (weight reset) occur together each quarter; prospective administration will set the effective date with advance announcement.

8 · Index calculation

Base 31 December 2016 = 1,000. Total return (dividends reinvested). The index level compounds the monthly weighted return of its constituents; a constituent that stops trading mid-quarter contributes its final (delisting) return and then drops, renormalizing over survivors.

9 · Corporate actions

10 · Governance & change control

Rules-based constituent selection — all membership and weighting follow the published rules, with no discretionary override of individual constituents. The methodology is versioned; material changes increment the version and are logged with an effective date. The methodology is frozen at v1.0 in advance of the date on which prospective tracking is scheduled to begin, 30 September 2026. From that date, the Indices will be tracked prospectively; all history prior to that date will remain labeled backtested (simulated), visually and textually distinguishable. The index is regenerated deterministically — the same inputs reproduce the same series.

11 · Limitations & disclosures

The limitations below should be considered when interpreting historical index performance and comparing the Indices with live commercial benchmarks.

  1. Backtested history. No live track record yet; backtested results do not reflect actual trading and are subject to hindsight in universe/data availability.
  2. Residual survivorship. The delisted universe is substantially but not exhaustively sourced; a small tail of sub-$2B historical exits remains unrecovered.
  3. Free-float weighting. The MCap class weights on free-float-adjusted market cap; closely-held shares are excluded.
  4. Liquidity screening. Both the $250M free-float floor and a $1M/day average-daily-value screen are enforced at each reconstitution.
  5. Exposure ≠ risk. The CRE-Exposure and NDFI-Exposure baskets are characteristic baskets; high exposure is not a quality judgment.
  6. Concentration in cap-weighted classes. The MCap class is megabank-concentrated; the EW class better expresses the underlying signal.
  7. Thin geographic sleeves. The Texas & Southwest index is Texas-dominated and holds ~17 names; equal-weighting mitigates but returns are noisier.
BankAtlas — U.S. Bank Equity Indices · Index Methodology v1.0 · © 2026. Backtested; prospective tracking scheduled to begin 30 September 2026. Rules-based analytical benchmarks that reflect proprietary risk signals; not investment advice. Grades and scores are not presented as credit ratings. Past performance does not indicate future results. Total returns and weighting inputs are sourced from a third-party market-data vendor.