Safe and Sound

ERIE

Erie, PA
4
Star Rating
ERIE is an Erie, PA-based, NCUA-insured credit union dating back to 1936. Regulatory filings show the credit union having $480.0 million in assets, as of June 30, 2017.

With 145 full-time employees, the credit union has amassed loans and leases worth $238.1 million. ERIE's 55,596 members currently have $420.4 million in shares with the credit union.

Overall, Bankrate believes that, as of June 30, 2017, ERIE exhibited a good condition, earning 4 out of 5 stars for safety and soundness. Here's a look at how the credit union did on the three key criteria Bankrate used to score American credit unions.

WHAT IS
SAFE AND SOUND?

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THE INSTITUTION'S SCORE

Capital Score

Capital works as a bulwark against losses and provides protection for members when a credit union is experiencing financial instability. It follows then that a credit union's level of capital is an essential measurement of its financial strength. When looking at safety and soundness, the more capital, the better.

ERIE scored below the national average of 15.26 on our test to measure the adequacy of a credit union's capital, achieving a score of 14 out of a possible 30 points.

ERIE's capitalization ratio of 11.00 percent in our test was worse than the average for all credit unions, suggesting that it's on less solid financial footing than its peers.

Asset Quality Score

This test's purpose is to try to understand how the credit union's capitalization and allocated loan loss reserves could be affected by problem assets, such as past-due mortgages.

A credit union with lots of these types of assets may eventually be forced to use capital to absorb losses, diminishing 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, resulting in lower earnings and potentially more risk of a failure in the future.

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

A lower-than-average ratio of troubled assets of 2.00 percent in our test was potentially indicative of superior financial strength compared to other credit unions.

Earnings score

A credit union's ability to earn money affects its safety and soundness. Earnings can be retained by the credit union, boosting its capital cushion, or be used to address problematic loans, likely making the credit union better able to withstand financial trouble. Losses, on the other hand, reduce a credit union's ability to do those things.

ERIE scored 10 out of a possible 30 on Bankrate's earnings test, below the national average of 10.31.

ERIE had an earnings ratio of 4.00 percent in our test, better 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.