Safe and Sound

LM

BALTIMORE, MD
4
Star Rating
Founded in 1949, LM is an NCUA-insured credit union headquartered in BALTIMORE, MD. As of June 30, 2017, the credit union had assets of $36.5 million.

Thanks to the work of 7 full-time employees, the credit union currently holds loans and leases worth $26.1 million. LM's 3,201 members currently have $33.6 million in shares with the credit union.

Overall, Bankrate believes that, as of June 30, 2017, LM exhibited a good condition, earning 4 out of 5 stars for safety and soundness. Keep reading for a breakdown of how the credit union did on the three important criteria Bankrate used to grade American credit unions.

WHAT IS
SAFE AND SOUND?

Find out

THE INSTITUTION'S SCORE

Capital Score

Capital works as a buffer against losses and affords protection for members when a credit union is struggling financially. Therefore, a credit union's level of capital is a crucial measurement of its financial resilience. From a safety and soundness perspective, the more capital, the better.

LM scored below the national average of 15.26 on our test to measure capital adequacy, scoring 6 out of a possible 30 points.

LM appears to be less well prepared for financial trouble than its peers in this area, with a capitalization ratio of 7.00 percent in our test, lower than the average for all credit unions.

Asset Quality Score

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

A credit union with a large number of these types of assets may eventually be forced to use capital to absorb losses, shrinking its cushion of equity. 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 future failure.

LM exceeded the national average of 38.15 on Bankrate's test of asset quality, racking up 40 out of a possible 40 points .

LM's ratio of troubled assets was 0.00 percent in our test, lower than the national average and suggestive of greater financial strength than other credit unions.

Earnings score

How successful a credit union is at earning money affects its long-term survivability. Earnings may be retained by the credit union, expanding its capital cushion, or be used to address problematic loans, potentially making the credit union more resilient in tough times. Conversely, losses reduce a credit union's ability to do those things.

LM scored 12 out of a possible 30 on Bankrate's earnings test, above the national average of 10.31.

One sign that LM is running ahead of its peers in this area was its earnings ratio of 5.00 percent in our test, better than 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.