Safe and Sound

DIRECTORS CHOICE

ALBANY, NY
5
Star Rating
DIRECTORS CHOICE is an ALBANY, NY-based, NCUA-insured credit union founded in 1999. Regulatory filings show the credit union having $8.5 million in assets, as of June 30, 2017.

Thanks to the efforts of 3 full-time employees, the credit union holds loans and leases worth $6.4 million. Its 810 members currently have $5.3 million in shares with the credit union.

Overall, Bankrate believes that, as of June 30, 2017, DIRECTORS CHOICE exhibited a superior condition, earning a full 5 stars for safety and soundness. Here's a look at how the credit union did on the three major criteria Bankrate used to score 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 as protection for members when a credit union is experiencing financial instability. It follows then that a credit union's level of capital is a key measurement of its financial resilience. When it comes to safety and soundness, the higher the capital, the better.

DIRECTORS CHOICE racked up 22 out of a possible 30 points on our test to measure capital adequacy, beating out the national average of 15.26.

DIRECTORS CHOICE's capitalization ratio of 16.00 percent in our test was above the average for all credit unions, suggesting that it's on more solid financial footing than its peers.

Asset Quality Score

In this test, Bankrate tries to estimate the effect of troubled assets, such as unpaid mortgages, on the credit union's reserves set aside to cover loan losses, as well as overall capitalization.

Having extensive holdings of these kinds of assets could eventually require a credit union to use capital to cover losses, reducing its equity cushion. Many of those assets are also likely to be in non-accrual status and thus aren't earning interest for the credit union, resulting in lower earnings and potentially more risk of a failure in the future.

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

DIRECTORS CHOICE's ratio of troubled assets was 10.00 percent in our test, above the national average and something to watch.

Earnings score

How successful a credit union is at earning money has an effect on its safety and soundness. A credit union can retain its earnings, boosting its capital cushion, or use them to address problematic loans, potentially making the credit union more resilient in times of trouble. Losses, on the other hand, reduce a credit union's ability to do those things.

DIRECTORS CHOICE scored 22 out of a possible 30 on Bankrate's earnings test, exceeding the national average of 10.31.

One sign that DIRECTORS CHOICE is doing better than its peers in this area was its earnings ratio of 14.00 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.