Safe and Sound

FOOTHILL

ARCADIA, CA
5
Star Rating
ARCADIA, CA-based FOOTHILL is an NCUA-insured credit union started in 1958. As of June 30, 2017, the credit union had assets of $412.0 million.

Members have $211.3 million on deposit tended by 69 full-time employees. With that footprint, the credit union has amassed loans and leases worth $211.3 million. Its 25,471 members currently have $360.2 million in shares with the credit union.

Overall, Bankrate believes that, as of June 30, 2017, FOOTHILL 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 important criteria Bankrate used to grade American credit unions on safety and soundness.

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SAFE AND SOUND?

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THE INSTITUTION'S SCORE

Capital Score

Capital acts as a buffer against losses and affords protection for members during periods of financial trouble for the credit union. It follows then that a credit union's level of capital is an essential measurement of its financial fortitude. When it comes to safety and soundness, more capital is better.

FOOTHILL received a score of 14 out of a possible 30 points on our test to measure capital adequacy, below the national average of 15.26.

FOOTHILL's capitalization ratio of 12.00 percent in our test was below the average for all credit unions, suggesting that it could have a harder time weathering financial trouble 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 reserves set aside to cover loan losses, as well as overall capitalization.

A credit union with large numbers of these kinds of assets could eventually be required to use capital to absorb losses, diminishing its equity buffer. Many of those assets are also likely to be in non-accrual status and no longer earning interest for the credit union, pushing down earnings and elevating the chances of a failure in the future.

FOOTHILL did better than the national average of 38.15 on Bankrate's test of asset quality, racking up 40 out of a possible 40 points .

A below-average ratio of troubled assets of 1.00 percent in our test was potentially indicative of greater financial strength than other credit unions.

Earnings score

A credit union's earnings performance has an effect on its long-term survivability. Earnings can be retained by the credit union, increasing its capital cushion, or be used to address problematic loans, likely making the credit union more resilient in tough times. Conversely, losses reduce a credit union's ability to do those things.

On Bankrate's earnings test, FOOTHILL scored 18 out of a possible 30, above the national average of 10.31.

The credit union had an earnings ratio of 8.00 percent in our test, better than the average for all credit unions, suggesting that it's beating 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.