Safe and Sound

ALABAMA LAW ENFORCEMENT CREDIT UNIO

BIRMINGHAM, AL
5
Star Rating
Started in 1939, ALABAMA LAW ENFORCEMENT CREDIT UNIO is an NCUA-insured credit union based in Birmingham, AL. As of December 31, 2017, the credit union held assets of $12.3 million.

Members have $9.4 million on deposit tended by 5 full-time employees. With that footprint, the credit union currently holds loans and leases worth $9.4 million. Its 1,772 members currently have $10.3 million in shares with the credit union.

Overall, Bankrate believes that, as of December 31, 2017, ALABAMA LAW ENFORCEMENT CREDIT UNIO exhibited a superior condition, earning a full 5 stars for safety and soundness. Here's an analysis of how the credit union did on the three important criteria Bankrate used to score U.S. 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 buffer against losses and as protection for members during times of financial instability for the credit union. It follows then that a credit union's level of capital is an important measurement of its financial strength. When looking at safety and soundness, more capital is better.

On our test to measure capital adequacy, ALABAMA LAW ENFORCEMENT CREDIT UNIO achieved a score of 22 out of a possible 30 points, beating out the national average of 15.65.

ALABAMA LAW ENFORCEMENT CREDIT UNIO appears to be more well prepared for financial trouble than its peers, with a capitalization ratio of 22.00 percent in our test, better than the average for all credit unions.

Asset Quality Score

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

A credit union with large numbers of these types of assets could eventually have to use capital to cover losses, diminishing 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 interest for the credit union, diminishing earnings and elevating the chances of a future failure.

ALABAMA LAW ENFORCEMENT CREDIT UNIO scored 32 out of a possible 40 points on Bankrate's test of asset quality, coming in below the national average of 38.09.

A lower-than-average ratio of problem assets of 0.00 percent in our test was potentially indicative of greater financial strength than other credit unions.

Earnings score

A credit union's profitability affects its safety and soundness. Earnings may be retained by the credit union, expanding its capital cushion, or be used to address problematic loans, likely making the credit union better prepared to withstand financial trouble. Losses, on the other hand, reduce a credit union's ability to do those things.

ALABAMA LAW ENFORCEMENT CREDIT UNIO scored 28 out of a possible 30 on Bankrate's earnings test, beating the national average of 10.11.

One indication that ALABAMA LAW ENFORCEMENT CREDIT UNIO is doing better than its peers in this area was its earnings ratio of 0.00 percent in our test, better than 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.