Safe and Sound

AMERICAN HERITAGE

Philadelphia, PA
4
Star Rating
AMERICAN HERITAGE is a Philadelphia, PA-based, NCUA-insured credit union that opened its doors in 1948. The credit union has $2.10 billion in assets, according to December 31, 2017, regulatory filings.

With 486 full-time employees, the credit union currently holds loans and leases worth $1.33 billion. AMERICAN HERITAGE's 167,851 members currently have $1.54 billion in shares with the credit union.

Overall, Bankrate believes that, as of December 31, 2017, AMERICAN HERITAGE exhibited a good condition, earning 4 out of 5 stars for safety and soundness. Keep reading for an analysis of how the credit union did on the three major criteria Bankrate used to score U.S. credit unions.

WHAT IS
SAFE AND SOUND?

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THE INSTITUTION'S SCORE

Capital Score

Capital is an essential measurement of an institution's financial resilience. It works as a buffer against losses and provides protection for members during times of economic trouble for the credit union. When it comes to safety and soundness, the more capital, the better.

AMERICAN HERITAGE scored below the national average of 15.65 on our test to measure the adequacy of a credit union's capital, achieving a score of 8 out of a possible 30 points.

AMERICAN HERITAGE's capitalization ratio of 8.00 percent in our test was below the average for all credit unions, an indication that it's weaker than its peers.

Asset Quality Score

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

A credit union with lots of these kinds of assets could eventually have to use capital to absorb losses, cutting down on its cushion of equity. Many of those assets are also likely to be in non-accrual status and no longer earning money, resulting in depressed earnings and potentially more risk of a future failure.

On Bankrate's asset quality test, AMERICAN HERITAGE scored 40 out of a possible 40 points, above the national average of 38.09 points.

Troubled assets made up 0.00 percent of the credit union's total assets in our test, below the national average and potentially indicative of superior financial strength compared to other credit unions.

Earnings score

How successful a credit union is at making money has an effect on its safety and soundness. A credit union can retain its earnings, expanding its capital cushion, or use them to deal with problematic loans, potentially making the credit union better prepared to withstand economic trouble. Conversely, losses lessen a credit union's ability to do those things.

AMERICAN HERITAGE received above-average marks on Bankrate's test of earnings, achieving a score of 18 out of a possible 30.

AMERICAN HERITAGE had an earnings ratio of 0.00 percent in our test, higher than the average for all credit unions, suggesting that it's beating 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.