Safe and Sound

CLEARPATH

GLENDALE, CA
4
Star Rating
GLENDALE, CA-based CLEARPATH is an NCUA-insured credit union founded in 1954. As of June 30, 2017, the credit union held assets of $112.7 million.

With 38 full-time employees, the credit union currently holds loans and leases worth $83.7 million. Its 12,603 members currently have $90.9 million in shares with the credit union.

Overall, Bankrate believes that, as of June 30, 2017, CLEARPATH exhibited a good condition, earning 4 out of 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 American credit unions.

WHAT IS
SAFE AND SOUND?

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THE INSTITUTION'S SCORE

Capital Score

Capital acts as a buffer against losses and provides protection for members when a credit union is experiencing financial trouble. It follows then that a credit union's level of capital is a useful measurement of its financial strength. When it comes to safety and soundness, the more capital, the better.

On our test to measure the adequacy of a credit union's capital, CLEARPATH received a score of 12 out of a possible 30 points, below the national average of 15.26.

CLEARPATH's capitalization ratio of 10.00 percent in our test was less than the average for all credit unions, a sign that it's on less solid financial footing than its peers.

Asset Quality Score

Bankrate uses this test to estimate the impact of troubled assets, such as unpaid mortgages, on the credit union's capitalization and allocated loan loss reserves.

A credit union with extensive holdings of these kinds of assets may eventually be forced to use capital to absorb losses, reducing its equity cushion. It also means that there are likely to be many assets that are in non-accrual status and no longer earning interest for the credit union, decreasing earnings and increasing the risk of a future failure.

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

CLEARPATH's ratio of problem assets was 2.00 percent in our test, below the national average and suggestive of superior financial strength compared to other credit unions.

Earnings score

A credit union's ability to earn money has an effect on its safety and soundness. A credit union can retain its earnings, expanding its capital cushion, or put them to work addressing problematic loans, likely making the credit union more resilient in tough times. Credit unions that are losing money, however, are less able to do those things.

On Bankrate's test of earnings, CLEARPATH scored 4 out of a possible 30, falling short of the national average of 10.31.

One sign that CLEARPATH is running ahead of its peers in this area was its earnings ratio of 2.00 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.