Safe and Sound

CONSUMERS

Denison, IA
4
Star Rating
CONSUMERS is a Denison, IA-based, NCUA-insured credit union founded in 1962. The credit union holds assets of $6.9 million, according to June 30, 2017, regulatory filings.

Members have $3.2 million on deposit tended by 4 full-time employees. With that footprint, the credit union currently holds loans and leases worth $3.2 million. Its 1,405 members currently have $6.0 million in shares with the credit union.

Overall, Bankrate believes that, as of June 30, 2017, CONSUMERS exhibited a good condition, earning 4 out of 5 stars for safety and soundness. Keep reading for an analysis of how the credit union did on the three important criteria Bankrate used to grade U.S. 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 struggling financially. It follows then that when it comes to measuring an an institution's financial strength, capital is important. From a safety and soundness perspective, the more capital, the better.

On our test to measure the adequacy of a credit union's capital, CONSUMERS achieved a score of 18 out of a possible 30 points, better than the national average of 15.26.

CONSUMERS's capitalization ratio of 13.00 percent in our test puts it right in line with the average for all credit unions.

Asset Quality Score

This test is intended to try to understand 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 mortgages.

Having a large number of these types of assets means a credit union could have to use capital to cover losses, cutting down on its buffer of equity. It also means that there are likely to be many assets that are in non-accrual status and thus aren't earning interest for the credit union, decreasing earnings and increasing the risk of a future failure.

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

A below-average ratio of problem assets of 0.00 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 has an effect on its long-term survivability. A credit union can retain its earnings, increasing its capital cushion, or use them to deal with problematic loans, likely making the credit union more resilient in tough times. Obviously, credit unions that are losing money are less able to do those things.

CONSUMERS did below-average on Bankrate's earnings test, achieving a score of 10 out of a possible 30.

One sign that the credit union is beating its peers in this area was its earnings ratio of 4.00 percent in our test, above 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.