Safe and Sound

SCE

EL MONTE, CA
4
Star Rating
SCE is an NCUA-insured credit union started in 1952 and currently headquartered in EL MONTE, CA. Regulatory filings show the credit union having assets of $679.9 million, as of June 30, 2017.

Members have $470.6 million on deposit tended by 184 full-time employees. With that footprint, the credit union holds loans and leases worth $470.6 million. SCE's 52,927 members currently have $587.0 million in shares with the credit union.

Overall, Bankrate believes that, as of June 30, 2017, SCE 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 major criteria Bankrate used to grade American credit unions.

WHAT IS
SAFE AND SOUND?

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THE INSTITUTION'S SCORE

Capital Score

Capital works as a cushion against losses and as protection for members when a credit union is struggling financially. It follows then that when it comes to measuring an an institution's financial stability, capital is useful. When looking at safety and soundness, more capital is better.

SCE received a score of 10 out of a possible 30 points on our test to measure the adequacy of a credit union's capital, lower than the national average of 15.26.

SCE's capitalization ratio of 10.00 percent in our test was less than the average for all credit unions, suggesting that it's weaker than its peers.

Asset Quality Score

In this test, Bankrate tries to determine the impact of troubled assets, such as unpaid mortgages, on the credit union's capitalization and allocated loan loss reserves.

A credit union with large numbers of these types of assets may eventually be forced to use capital to cover losses, reducing 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, decreasing earnings and elevating the risk of a future failure.

On Bankrate's test of asset quality, SCE scored 40 out of a possible 40 points, exceeding the national average of 38.15 points.

Troubled assets made up 4.00 percent of the credit union's total assets in our test, lower than the national average and potentially indicative of greater financial strength than other credit unions.

Earnings score

A credit union's earnings performance has an effect on its long-term survivability. A credit union can retain its earnings, boosting its capital buffer, or put them to work addressing problematic loans, potentially making the credit union more resilient in times of trouble. Losses, on the other hand, reduce a credit union's ability to do those things.

On Bankrate's earnings test, SCE scored 10 out of a possible 30, below the national average of 10.31.

One indication that SCE is outperforming its peers in this area was its earnings ratio of 4.00 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.