Safe and Sound

ALLEGACY

Winston Salem, NC
5
Star Rating
ALLEGACY is an NCUA-insured credit union started in 1967 and currently headquartered in Winston Salem, NC. Regulatory filings show the credit union having assets of $1.30 billion, as of June 30, 2017.

With 324 full-time employees, the credit union holds loans and leases worth $1.03 billion. Its 137,590 members currently have $1.11 billion in shares with the credit union.

Overall, Bankrate believes that, as of June 30, 2017, ALLEGACY exhibited a superior condition, earning a full 5 stars for safety and soundness. Here's a look at how the credit union faired on the three major criteria Bankrate used to evaluate U.S. credit unions on safety and soundness.

WHAT IS
SAFE AND SOUND?

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THE INSTITUTION'S SCORE

Capital Score

Capital acts as a buffer against losses and affords protection for members when a credit union is struggling financially. It follows then that when it comes to measuring an an institution's financial resilience, capital is crucial. When looking at safety and soundness, the higher the capital, the better.

ALLEGACY fell below the national average of 15.26 on our test to measure the adequacy of a credit union's capital, achieving a score of 12 out of a possible 30 points.

ALLEGACY had a capitalization ratio of 10.00 percent in our test, lower than the average for all credit unions, suggesting that it could be less resilient in a crisis than its peers.

Asset Quality Score

This test's purpose is 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 unpaid loans.

Having lots of these kinds of assets suggests a credit union may eventually have to use capital to cover losses, cutting down on its cushion of equity. It also means that there are likely to be many assets that are in non-accrual status and no longer earning money, pushing down earnings and increasing the chances of a future failure.

ALLEGACY scored 40 out of a possible 40 points on Bankrate's test of asset quality, beating out the national average of 38.15.

A below-average ratio of problem assets of 6.00 percent in our test was potentially indicative of greater financial strength than other credit unions.

Earnings score

How successful a credit union is at making money affects its safety and soundness. A credit union can retain its earnings, boosting its capital buffer, or use them to address problematic loans, potentially making the credit union more resilient in times of trouble. Credit unions that are losing money, however, are less able to do those things.

ALLEGACY did above-average on Bankrate's test of earnings, achieving a score of 18 out of a possible 30.

One indication that the credit union is outperforming its peers in this area was its earnings ratio of 8.00 percent in our test, better than the average for all credit unions.

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.