Safe and Sound

HAPO COMMUNITY

RICHLAND, WA
4
Star Rating
HAPO COMMUNITY is an NCUA-insured credit union started in 1953 and currently based in RICHLAND, WA. As of June 30, 2017, the credit union held assets of $1.54 billion.

With 349 full-time employees, the credit union has amassed loans and leases worth $1.36 billion. HAPO COMMUNITY's 148,023 members currently have $1.34 billion in shares with the credit union.

Overall, Bankrate believes that, as of June 30, 2017, HAPO COMMUNITY exhibited a good condition, earning 4 out of 5 stars for safety and soundness. Keep reading for an analysis of how the credit union faired on the three key criteria Bankrate used to evaluate American credit unions.

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SAFE AND SOUND?

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THE INSTITUTION'S SCORE

Capital Score

Capital is a useful measurement of an institution's financial resilience. It acts as a buffer against losses and affords protection for members when a credit union is experiencing economic instability. From a safety and soundness perspective, the more capital, the better.

HAPO COMMUNITY fell below the national average of 15.26 on our test to measure the adequacy of a credit union's capital, receiving a score of 6 out of a possible 30 points.

HAPO COMMUNITY appears to be less well prepared for financial trouble than its peers in this area, with a capitalization ratio of 8.00 percent in our test, below the average for all credit unions.

Asset Quality Score

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

A credit union with extensive holdings of these types of assets may eventually have to use capital to absorb losses, shrinking its cushion of equity. It also means that there are likely to be many assets that are in non-accrual status and no longer earning money, resulting in diminished earnings and potentially more risk of a failure in the future.

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

HAPO COMMUNITY's ratio of problem assets was 3.00 percent in our test, below the national average and potentially indicative of superior financial strength compared to other credit unions.

Earnings score

A credit union's profitability has an effect on its safety and soundness. Earnings can be retained by the credit union, giving a boost to its capital cushion, or be used to deal with problematic loans, likely making the credit union more resilient in tough times. Conversely, losses diminish a credit union's ability to do those things.

HAPO COMMUNITY did above-average on Bankrate's test of earnings, achieving a score of 14 out of a possible 30.

The credit union had an earnings ratio of 6.00 percent in our test, better than the average for all credit unions, an indication that it's doing better than 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.