Safe and Sound

ALABAMA LAW ENFORCEMENT CREDIT UNIO

BIRMINGHAM, AL
5
Star Rating
Started in 1939, ALABAMA LAW ENFORCEMENT CREDIT UNIO is an NCUA-insured credit union based in BIRMINGHAM, AL. As of June 30, 2017, the credit union held assets of $11.5 million.

Thanks to the work of 5 full-time employees, the credit union currently holds loans and leases worth $8.6 million. ALABAMA LAW ENFORCEMENT CREDIT UNIO's 1,689 members currently have $9.6 million in shares with the credit union.

Overall, Bankrate believes that, as of June 30, 2017, ALABAMA LAW ENFORCEMENT CREDIT UNIO exhibited a superior condition, earning a full 5 stars for safety and soundness. Keep reading for an analysis of how the credit union faired on the three key criteria Bankrate used to evaluate American credit unions on safety and soundness.

WHAT IS
SAFE AND SOUND?

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THE INSTITUTION'S SCORE

Capital Score

Capital is a key measurement of an institution's financial resilience. It acts as a cushion against losses and as protection for members when a credit union is experiencing economic instability. When it comes to safety and soundness, the higher the capital, the better.

On our test to measure the adequacy of a credit union's capital, ALABAMA LAW ENFORCEMENT CREDIT UNIO achieved a score of 22 out of a possible 30 points, beating out the national average of 15.26.

ALABAMA LAW ENFORCEMENT CREDIT UNIO had a capitalization ratio of 15.00 percent in our test, higher than the average for all credit unions, a sign that it's on more solid financial footing than its peers.

Asset Quality Score

This test is intended to estimate how the credit union's reserves set aside to cover loan losses, as well as overall capitalization could be affected by troubled assets, such as past-due loans.

Having lots of these kinds of assets suggests a credit union could have to use capital to cover losses, cutting down on its equity cushion. It also means that there are likely to be many assets that are in non-accrual status and no longer earning money, resulting in lower earnings and potentially more risk of a future failure.

ALABAMA LAW ENFORCEMENT CREDIT UNIO finished below the national average of 38.15 on Bankrate's test of asset quality, racking up 32 out of a possible 40 points .

A greater-than-average ratio of problem assets of 14.00 percent in our test was something to watch for ALABAMA LAW ENFORCEMENT CREDIT UNIO.

Earnings score

A credit union's ability to earn money affects its safety and soundness. Earnings may be retained by the credit union, expanding its capital cushion, or be used to deal with problematic loans, potentially making the credit union better prepared to withstand economic shocks. Losses, on the other hand, lessen a credit union's ability to do those things.

ALABAMA LAW ENFORCEMENT CREDIT UNIO scored 30 out of a possible 30 on Bankrate's test of earnings, better than the national average of 10.31.

ALABAMA LAW ENFORCEMENT CREDIT UNIO had an earnings ratio of 21.00 percent in our test, above the average for all credit unions, suggesting that it's doing better than its peers in this area.

WHAT IS SAFE & SOUND?

Bankrate.com's Safe & Sound Ratings provide a star rating system to evaluate the current financial status of financial institutions. The information gathered about banks, credit unions and thrifts is updated as set forth in the Terms of Use of Safe & Sound Ratings and Reports. The Safe & Sound Ratings information is grouped by categories of banks, thrifts and credit unions.

Scoring methodology

Bankrate.com evaluates the financial condition of institutions and assigns a one- to five-star rating for each with five stars representing the highest rating. Institutions with satisfactory performance will generally receive a rating of three or more stars. The majority of institutions fall into the three- to four-star range. An institution with an "NR" rating may be too new to rate or may have limited the publicly available information in their regulatory filings. The "NR" is not an indication of financial strength or weakness. The Safe & Sound rating is believed to be reliable, but the information is not guaranteed. In addition, events since the information was collected may have altered the institution's financial condition.