Safe and Sound

AAC

Grand Rapids, MI
5
Star Rating
Founded in 1937, AAC is an NCUA-insured credit union headquartered in Grand Rapids, MI. As of December 31, 2017, the credit union held assets of $139.3 million.

Members have $92.6 million on deposit tended by 32 full-time employees. With that footprint, the credit union currently holds loans and leases worth $92.6 million. AAC's 15,367 members currently have $100.2 million in shares with the credit union.

Overall, Bankrate believes that, as of December 31, 2017, AAC exhibited a superior condition, earning a full 5 stars for safety and soundness. Keep reading for a breakdown of how the credit union faired on the three important criteria Bankrate used to evaluate U.S. credit unions on safety and soundness.

WHAT IS
SAFE AND SOUND?

Find out

THE INSTITUTION'S SCORE

Capital Score

Capital works as a buffer against losses and as protection for members when a credit union is experiencing financial trouble. It follows then that when it comes to measuring an an institution's financial resilience, capital is valuable. From a safety and soundness perspective, the higher the capital, the better.

AAC scored 28 out of a possible 30 points on our test to measure the adequacy of a credit union's capital, above the national average of 15.65.

AAC's capitalization ratio of 28.00 percent in our test was better than the average for all credit unions, a sign that it's more well prepared for financial trouble than its peers.

Asset Quality Score

In this test, Bankrate tries to estimate the effect of problem assets, such as past-due mortgages, on the credit union's capitalization and allocated loan loss reserves.

A credit union with lots of these types of assets may eventually be required to use capital to absorb losses, decreasing its cushion of equity. It also means that there are likely to be many assets that are in non-accrual status and thus aren't earning money, resulting in reduced earnings and potentially more risk of a future failure.

AAC exceeded the national average of 38.09 on Bankrate's asset quality test, racking up 40 out of a possible 40 points .

A lower-than-average ratio of troubled assets of 0.00 percent in our test was potentially indicative of superior financial strength compared to other credit unions.

Earnings score

A credit union's profitability 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, likely making the credit union more resilient in times of trouble. Conversely, losses take away from a credit union's ability to do those things.

On Bankrate's earnings test, AAC scored 18 out of a possible 30, better than the national average of 10.11.

The credit union had an earnings ratio of 0.00 percent in our test, above the average for all credit unions, suggesting that it's outperforming 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.