Safe and Sound

NEWARK POLICE

Newark, NJ
5
Star Rating
NEWARK POLICE is a Newark, NJ-based, NCUA-insured credit union dating back to 1941. The credit union holds assets of $6.2 million, according to June 30, 2017, regulatory filings.

Thanks to the work of 2 full-time employees, the credit union currently holds loans and leases worth $2.8 million. NEWARK POLICE's 1,560 members currently have $4.8 million in shares with the credit union.

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

WHAT IS
SAFE AND SOUND?

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THE INSTITUTION'S SCORE

Capital Score

Capital is an important measurement of an institution's financial fortitude. It acts as a buffer against losses and provides protection for members when a credit union is struggling financially. From a safety and soundness perspective, more capital is better.

On our test to measure the adequacy of a credit union's capital, NEWARK POLICE achieved a score of 30 out of a possible 30 points, above the national average of 15.26.

NEWARK POLICE appears to be on more solid financial footing than its peers, with a capitalization ratio of 23.00 percent in our test, higher than the average for all credit unions.

Asset Quality Score

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

A credit union with a large number of these types of assets could eventually be forced to use capital to absorb losses, diminishing its equity cushion. It also means that there are likely to be many assets that are in non-accrual status and thus aren't earning money, diminishing earnings and increasing the risk of a failure in the future.

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

A lower-than-average ratio of problem assets of 5.00 percent in our test was potentially indicative of superior financial strength compared to other credit unions.

Earnings score

How successful a credit union is at making money has an effect on its safety and soundness. A credit union can retain its earnings, expanding its capital cushion, or use them to address problematic loans, potentially making the credit union more resilient in times of trouble. Obviously, credit unions that are losing money are less able to do those things.

NEWARK POLICE did below-average on Bankrate's earnings test, achieving a score of 6 out of a possible 30.

One sign that the credit union is outperforming its peers in this area was its earnings ratio of 2.00 percent in our test, higher 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.