Safe and Sound

SANTA CRUZ COMMUNITY

Santa Cruz, CA
4
Star Rating
Started in 1977, SANTA CRUZ COMMUNITY is an NCUA-insured credit union headquartered in Santa Cruz, CA. As of June 30, 2017, the credit union had assets of $111.9 million.

Thanks to the efforts of 39 full-time employees, the credit union holds loans and leases worth $84.7 million. Its 12,629 members currently have $102.3 million in shares with the credit union.

Overall, Bankrate believes that, as of June 30, 2017, SANTA CRUZ COMMUNITY exhibited a good condition, earning 4 out of 5 stars for safety and soundness. Here's a look at how the credit union did on the three key criteria Bankrate used to grade American credit unions.

WHAT IS
SAFE AND SOUND?

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THE INSTITUTION'S SCORE

Capital Score

When it comes to measuring a credit union's financial strength, capital is valuable. It works as a bulwark against losses and provides protection for members when a credit union is struggling financially. When it comes to safety and soundness, the higher the capital, the better.

SANTA CRUZ COMMUNITY fell short of the national average of 15.26 on our test to measure the adequacy of a credit union's capital, receiving a score of 6 out of a possible 30 points.

SANTA CRUZ COMMUNITY had a capitalization ratio of 7.00 percent in our test, less than the average for all credit unions, a sign that it's weaker than its peers.

Asset Quality Score

This test is intended to try to understand how the credit union's loan loss reserves and overall capitalization could be affected by problem assets, such as unpaid mortgages.

Having lots of these types of assets may eventually require a credit union to use capital to cover losses, diminishing its equity buffer. Many of those assets are also likely to be in non-accrual status and no longer earning money, diminishing earnings and increasing the risk of a failure in the future.

On Bankrate's test of asset quality, SANTA CRUZ COMMUNITY scored 28 out of a possible 40 points, coming in below the national average of 38.15 points.

Troubled assets made up 25.00 percent of the credit union's total assets in our test, greater than the national average and a potential cause for concern.

Earnings score

How successful a credit union is at earning money affects its safety and soundness. A credit union can retain its earnings, giving a boost to its capital buffer, or use them to address problematic loans, potentially making the credit union better able to withstand economic trouble. However, credit unions that are losing money are less able to do those things.

On Bankrate's test of earnings, SANTA CRUZ COMMUNITY scored 26 out of a possible 30, exceeding the national average of 10.31.

The credit union had an earnings ratio of 18.00 percent in our test, above the average for all credit unions, a sign that it's beating 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.