Safe and Sound

MEMBERS ADVANTAGE

MICHIGAN CITY, IN
3
Star Rating
Founded in 1962, MEMBERS ADVANTAGE is an NCUA-insured credit union based in MICHIGAN CITY, IN. As of June 30, 2017, the credit union had assets of $94.7 million.

Members have $41.2 million on deposit tended by 28 full-time employees. With that footprint, the credit union currently holds loans and leases worth $41.2 million. Its 8,557 members currently have $84.6 million in shares with the credit union.

Overall, Bankrate believes that, as of June 30, 2017, MEMBERS ADVANTAGE exhibited a generally satisfactory condition, earning 3 out of 5 stars for safety and soundness. Here's a look at how the credit union did on the three major criteria Bankrate used to evaluate U.S. credit unions.

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THE INSTITUTION'S SCORE

Capital Score

When it comes to measuring an institution's financial stability, capital is crucial. It works as a buffer against losses and affords protection for members during times of economic trouble for the credit union. When it comes to safety and soundness, the more capital, the better.

MEMBERS ADVANTAGE received a score of 12 out of a possible 30 points on our test to measure capital adequacy, failing to reach the national average of 15.26.

MEMBERS ADVANTAGE's capitalization ratio of 10.00 percent in our test was below the average for all credit unions, suggesting that it's less well prepared for financial trouble than its peers.

Asset Quality Score

Bankrate uses this test to estimate the effect of problem assets, such as unpaid loans, on the credit union's reserves set aside to cover loan losses, as well as overall capitalization.

A credit union with lots of these types of assets may eventually be required to use capital to cover losses, reducing its equity buffer. It also means that there are likely to be many assets that are in non-accrual status and no longer earning interest for the credit union, resulting in reduced earnings and potentially more risk of a failure in the future.

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

A lower-than-average ratio of problem 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 earnings performance affects its long-term survivability. A credit union can retain its earnings, increasing its capital buffer, or put them to work addressing problematic loans, potentially 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.

MEMBERS ADVANTAGE underperformed the average on Bankrate's test of earnings, achieving a score of 2 out of a possible 30.

MEMBERS ADVANTAGE had an earnings ratio of 1.00 percent in our test, equal to the average for all credit unions, suggesting that it's right in line with 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.