Safe and Sound

ALABAMA TEACHERS

GADSDEN, AL
5
Star Rating
GADSDEN, AL-based ALABAMA TEACHERS is an NCUA-insured credit union founded in 1959. The credit union holds assets of $285.8 million, according to December 31, 2017, regulatory filings.

Members have $223.3 million on deposit tended by 74 full-time employees. With that footprint, the credit union currently holds loans and leases worth $223.3 million. Its 24,792 members currently have $243.8 million in shares with the credit union.

Overall, Bankrate believes that, as of December 31, 2017, ALABAMA TEACHERS 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 major criteria Bankrate used to evaluate American credit unions on safety and soundness.

WHAT IS
SAFE AND SOUND?

Find out

THE INSTITUTION'S SCORE

Capital Score

When it comes to measuring a credit union's financial stability, capital is useful. 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.

ALABAMA TEACHERS beat out the national average of 15.65 points on our test to measure capital adequacy, receiving a score of 18 out of a possible 30 points.

ALABAMA TEACHERS had a capitalization ratio of 18.00 percent in our test, better than the average for all credit unions, suggesting that it's on more solid financial footing than its peers.

Asset Quality Score

Bankrate uses this test to determine the effect of troubled assets, such as unpaid mortgages, on the credit union's reserves set aside to cover loan losses, as well as overall capitalization.

Having large numbers of these types of assets suggests a credit union may eventually have to use capital to absorb losses, diminishing its equity cushion. 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.

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

A lower-than-average ratio of problem 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 affects its safety and soundness. Earnings can be retained by the credit union, boosting its capital buffer, or be used to deal with problematic loans, likely making the credit union better able to withstand economic trouble. Obviously, credit unions that are losing money have less ability to do those things.

ALABAMA TEACHERS scored 12 out of a possible 30 on Bankrate's test of earnings, better than the national average of 10.11.

One sign that the credit union is running ahead of its peers in this area was its earnings ratio of 0.00 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.