The CAMELS ratings or Camels rating is a United States supervisory rating of the bank's overall condition used to classify the nation’s fewer than 8,000 banks. This rating is based on financial statements of the bank and on-site examination by regulators like the Federal Reserve, the Office of the Comptroller of the Currency and Federal Deposit Insurance Corporation. The scale is from 1 to 5 with 1 being strongest and 5 being weakest. These ratings are not released to the public but only to the top management of the banking company to prevent a bank run on a bank which has a bad CAMELS rating.
It is a tool being used by the United States government in response to the global financial crisis of 2008 to help it decide which banks to provide special help for and which not to as part of its capitalization program authorized by the Emergency Economic Stabilization Act of 2008.
Read more about this topic: CAMEL Rating System