Safe and Sound

MONTEREY

MONTEREY, CA
4
Star Rating
MONTEREY, CA-based MONTEREY is an NCUA-insured credit union founded in 1968. The credit union has assets of $232.9 million, according to June 30, 2017, regulatory filings.

With 64 full-time employees, the credit union has amassed loans and leases worth $137.1 million. Its 18,522 members currently have $197.3 million in shares with the credit union.

Overall, Bankrate believes that, as of June 30, 2017, MONTEREY 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 evaluate American credit unions.

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THE INSTITUTION'S SCORE

Capital Score

Capital acts as a bulwark against losses and affords protection for members during periods of financial instability for the credit union. It follows then that when it comes to measuring an an institution's financial stability, capital is key. When looking at safety and soundness, the more capital, the better.

MONTEREY exceeded the national average of 15.26 points on our test to measure the adequacy of a credit union's capital, scoring 18 out of a possible 30 points.

MONTEREY appears to be more well prepared for financial trouble than its peers, with a capitalization ratio of 14.00 percent in our test, above the average for all credit unions.

Asset Quality Score

This test's purpose is to estimate how the credit union's loan loss reserves and overall capitalization could be affected by troubled assets, such as unpaid mortgages.

A credit union with extensive holdings of these kinds of assets may eventually be forced to use capital to absorb losses, diminishing 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 interest for the credit union, diminishing earnings and elevating the risk of a failure in the future.

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

The credit union's ratio of problem assets was 4.00 percent in our test, less than the national average and potentially indicative of superior financial strength compared to other credit unions.

Earnings score

A credit union's ability to earn money has an effect on its long-term survivability. Earnings may be retained by the credit union, boosting its capital buffer, or be used to address problematic loans, likely making the credit union more resilient in tough times. Obviously, credit unions that are losing money have less ability to do those things.

MONTEREY underperformed the average on Bankrate's test of earnings, achieving a score of 8 out of a possible 30.

One indication that the credit union is beating its peers in this area was its earnings ratio of 3.00 percent in our test, above 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.