Safe and Sound

MCLENNAN COUNTY EMPLOYEES

WACO, TX
5
Star Rating
MCLENNAN COUNTY EMPLOYEES is an NCUA-insured credit union founded in 1955 and currently headquartered in WACO, TX. As of June 30, 2017, the credit union had assets of $19.7 million.

With 4 full-time employees, the credit union holds loans and leases worth $5.9 million. Its 1,376 members currently have $14.7 million in shares with the credit union.

Overall, Bankrate believes that, as of June 30, 2017, MCLENNAN COUNTY EMPLOYEES exhibited a superior condition, earning a full 5 stars for safety and soundness. Here's an analysis of how the credit union did on the three key criteria Bankrate used to grade U.S. credit unions on safety and soundness.

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THE INSTITUTION'S SCORE

Capital Score

When it comes to measuring a credit union's financial strength, capital is crucial. It works as a buffer against losses and provides protection for members when a credit union is struggling financially. When it comes to safety and soundness, more capital is preferred.

MCLENNAN COUNTY EMPLOYEES scored above the national average of 15.26 points on our test to measure capital adequacy, scoring 30 out of a possible 30 points.

MCLENNAN COUNTY EMPLOYEES's capitalization ratio of 25.00 percent in our test was higher than the average for all credit unions, a sign that it could have an easier time weathering financial trouble than its peers.

Asset Quality Score

This test is intended to try to understand how the credit union's reserves set aside to cover loan losses, as well as overall capitalization could be affected by troubled assets, such as past-due loans.

Having large numbers of these types of assets could eventually require a credit union 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 no longer earning money, pushing down earnings and elevating the chances of a failure in the future.

MCLENNAN COUNTY EMPLOYEES scored 40 out of a possible 40 points on Bankrate's asset quality test, better than the national average of 38.15.

The credit union's ratio of problem assets was 0.00 percent in our test, lower than the national average and potentially indicative of greater financial strength than other credit unions.

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, expanding its capital buffer, or use them to address problematic loans, likely making the credit union more resilient in tough times. Conversely, losses take away from a credit union's ability to do those things.

MCLENNAN COUNTY EMPLOYEES scored 4 out of a possible 30 on Bankrate's test of earnings, lower than the national average of 10.31.

One sign that the credit union is beating its peers in this area was its earnings ratio of 2.00 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.