Safe and Sound

BAY

Capitola, CA
4
Star Rating
Founded in 1957, BAY is an NCUA-insured credit union based in Capitola, CA. As of June 30, 2017, the credit union had assets of $907.8 million.

Thanks to the work of 212 full-time employees, the credit union holds loans and leases worth $546.8 million. BAY's 68,268 members currently have $816.0 million in shares with the credit union.

Overall, Bankrate believes that, as of June 30, 2017, BAY exhibited a good condition, earning 4 out of 5 stars for safety and soundness. Here's an analysis of how the credit union did on the three major criteria Bankrate used to evaluate U.S. credit unions.

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SAFE AND SOUND?

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THE INSTITUTION'S SCORE

Capital Score

Capital is a useful measurement of an institution's financial strength. It works as a buffer against losses and as protection for members when a credit union is struggling financially. From a safety and soundness perspective, the higher the capital, the better.

BAY scored below the national average of 15.26 on our test to measure capital adequacy, receiving a score of 8 out of a possible 30 points.

BAY appears to be on less solid financial footing than its peers in this area, with a capitalization ratio of 8.00 percent in our test, less than the average for all credit unions.

Asset Quality Score

Bankrate uses this test to determine the impact of problem assets, such as past-due loans, on the credit union's capitalization and allocated loan loss reserves.

Having a large number of these types of assets could eventually require a credit union to use capital to absorb losses, decreasing its cushion of equity. Many of those assets are also likely to be in non-accrual status and no longer earning interest for the credit union, resulting in reduced earnings and potentially more risk of a failure in the future.

BAY scored below the national average of 38.15 on Bankrate's test of asset quality, racking up 36 out of a possible 40 points .

BAY's ratio of problem assets was 7.00 percent in our test, the same as the national average.

Earnings score

A credit union's earnings performance has an effect on its long-term survivability. Earnings can be retained by the credit union, increasing its capital buffer, or be used to address problematic loans, likely making the credit union more resilient in tough times. However, credit unions that are losing money are less able to do those things.

On Bankrate's earnings test, BAY scored 20 out of a possible 30, beating out the national average of 10.31.

BAY had an earnings ratio of 11.00 percent in our test, above the average for all credit unions, a sign 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.