Safe and Sound

COMMUNITY 1ST

OTTUMWA, IA
3
Star Rating
Founded in 1936, COMMUNITY 1ST is an NCUA-insured credit union headquartered in OTTUMWA, IA. The credit union holds assets of $613.8 million, according to June 30, 2017, regulatory filings.

Members have $527.8 million on deposit tended by 193 full-time employees. With that footprint, the credit union currently holds loans and leases worth $527.8 million. Its 54,753 members currently have $532.3 million in shares with the credit union.

Overall, Bankrate believes that, as of June 30, 2017, COMMUNITY 1ST exhibited a generally satisfactory condition, earning 3 out of 5 stars for safety and soundness. Here's a look at how the credit union faired on the three important 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 cushion against losses and affords protection for members when a credit union is experiencing financial instability. It follows then that a credit union's level of capital is an important measurement of its financial resilience. When looking at safety and soundness, the more capital, the better.

COMMUNITY 1ST scored below the national average of 15.26 on our test to measure capital adequacy, achieving a score of 8 out of a possible 30 points.

COMMUNITY 1ST had a capitalization ratio of 9.00 percent in our test, below the average for all credit unions, suggesting that it could have a harder time weathering financial trouble than its peers.

Asset Quality Score

This test's purpose is to try to understand how the credit union's loan loss reserves and overall capitalization could be affected by troubled assets, such as unpaid loans.

Having extensive holdings of these types of assets means a credit union may 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 thus aren't earning money, pushing down earnings and elevating the risk of a failure in the future.

COMMUNITY 1ST came in below the national average of 38.15 on Bankrate's asset quality test, racking up 36 out of a possible 40 points .

A greater-than-average ratio of troubled assets of 8.00 percent in our test was something to watch for COMMUNITY 1ST.

Earnings score

How successful a credit union is at making money has an effect on its safety and soundness. A credit union can retain its earnings, giving a boost to its capital buffer, or use them to deal with problematic loans, likely making the credit union better able to withstand economic trouble. Obviously, credit unions that are losing money are less able to do those things.

COMMUNITY 1ST scored 10 out of a possible 30 on Bankrate's test of earnings, coming in below the national average of 10.31.

COMMUNITY 1ST had an earnings ratio of 5.00 percent in our test, higher than the average for all credit unions, suggesting that it's outperforming 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.