Safe and Sound

POLICE & FIRE

Philadelphia, PA
5
Star Rating
POLICE & FIRE is a Philadelphia, PA-based, NCUA-insured credit union dating back to 1938. Regulatory filings show the credit union having $4.81 billion in assets, as of June 30, 2017.

Thanks to the efforts of 646 full-time employees, the credit union holds loans and leases worth $2.66 billion. POLICE & FIRE's 263,059 members currently have $3.93 billion in shares with the credit union.

Overall, Bankrate believes that, as of June 30, 2017, POLICE & FIRE exhibited a superior condition, earning a full 5 stars for safety and soundness. Keep reading for an analysis of how the credit union did on the three major criteria Bankrate used to score American credit unions on safety and soundness.

WHAT IS
SAFE AND SOUND?

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THE INSTITUTION'S SCORE

Capital Score

Capital acts as a bulwark against losses and as protection for members during periods of financial trouble for the credit union. It follows then that when it comes to measuring an a credit union's financial stability, capital is crucial. From a safety and soundness perspective, more capital is better.

POLICE & FIRE exceeded the national average of 15.26 points on our test to measure the adequacy of a credit union's capital, racking up 26 out of a possible 30 points.

POLICE & FIRE had a capitalization ratio of 18.00 percent in our test, better than the average for all credit unions, an indication that it's more well prepared for financial trouble than its peers.

Asset Quality Score

Bankrate uses this test to estimate the impact of troubled assets, such as past-due 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 kinds of assets may eventually be forced to use capital to absorb losses, shrinking 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 interest for the credit union, resulting in depressed earnings and potentially more risk of a future failure.

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

Troubled assets made up 2.00 percent of POLICE & FIRE's total assets in our test, less than the national average and suggestive of greater financial strength than other credit unions.

Earnings score

A credit union's profitability affects its long-term survivability. A credit union can retain its earnings, giving a boost to its capital cushion, or put them to work addressing problematic loans, likely making the credit union more resilient in tough times. Credit unions that are losing money, however, have less ability to do those things.

On Bankrate's test of earnings, POLICE & FIRE scored 16 out of a possible 30, exceeding the national average of 10.31.

POLICE & FIRE had an earnings ratio of 8.00 percent in our test, better than the average for all credit unions, suggesting that it's running ahead of 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.