Safe and Sound

VALLEY ISLE COMMUNITY

Kahului, HI
4
Star Rating
VALLEY ISLE COMMUNITY is an NCUA-insured credit union started in 1940 and currently headquartered in Kahului, HI. Regulatory filings show the credit union having assets of $115.9 million, as of June 30, 2017.

With 23 full-time employees, the credit union currently holds loans and leases worth $45.6 million. VALLEY ISLE COMMUNITY's 13,377 members currently have $103.2 million in shares with the credit union.

Overall, Bankrate believes that, as of June 30, 2017, VALLEY ISLE COMMUNITY exhibited a good condition, earning 4 out of 5 stars for safety and soundness. Here's an analysis of how the credit union did on the three major criteria Bankrate used to score American credit unions.

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THE INSTITUTION'S SCORE

Capital Score

Capital works as a buffer against losses and provides protection for members during times of economic instability for the credit union. It follows then that a credit union's level of capital is an essential measurement of its financial resilience. When looking at safety and soundness, more capital is better.

On our test to measure capital adequacy, VALLEY ISLE COMMUNITY received a score of 10 out of a possible 30 points, coming in below the national average of 15.26.

VALLEY ISLE COMMUNITY's capitalization ratio of 10.00 percent in our test was less than the average for all credit unions, a sign that it could have a harder time weathering financial trouble than its peers.

Asset Quality Score

Bankrate uses this test to determine the impact of problem assets, such as past-due loans, on the credit union's capitalization and allocated loan loss reserves.

Having extensive holdings of these types of assets means a credit union may eventually have 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 thus aren't earning interest for the credit union, resulting in reduced earnings and potentially more risk of a failure in the future.

On Bankrate's test of asset quality, VALLEY ISLE COMMUNITY scored 40 out of a possible 40 points, beating out the national average of 38.15 points.

The credit union's ratio of troubled assets was 4.00 percent in our test, less than the national average and suggestive 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, increasing its capital buffer, or be used to address problematic loans, potentially making the credit union more resilient in tough times. However, credit unions that are losing money have less ability to do those things.

VALLEY ISLE COMMUNITY scored 6 out of a possible 30 on Bankrate's earnings test, failing to reach the national average of 10.31.

VALLEY ISLE COMMUNITY had an earnings ratio of 3.00 percent in our test, higher than the average for all credit unions, a sign that it's doing better than 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.