Safe and Sound

APPALACHIAN POWER EMPLOYEES

HUNTINGTON, WV
5
Star Rating
HUNTINGTON, WV-based APPALACHIAN POWER EMPLOYEES is an NCUA-insured credit union founded in 1936. As of December 31, 2017, the credit union held assets of $6.8 million.

With 2 full-time employees, the credit union has amassed loans and leases worth $3.4 million. APPALACHIAN POWER EMPLOYEES's 1,023 members currently have $5.5 million in shares with the credit union.

Overall, Bankrate believes that, as of December 31, 2017, APPALACHIAN POWER EMPLOYEES exhibited a superior condition, earning a full 5 stars for safety and soundness. Keep reading for a look at how the credit union faired on the three major criteria Bankrate used to score American credit unions on safety and soundness.

WHAT IS
SAFE AND SOUND?

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THE INSTITUTION'S SCORE

Capital Score

When it comes to measuring a credit union's financial fortitude, capital is important. It works as a bulwark against losses and as protection for members when a credit union is struggling financially. From a safety and soundness perspective, the more capital, the better.

On our test to measure capital adequacy, APPALACHIAN POWER EMPLOYEES racked up 28 out of a possible 30 points, beating out the national average of 15.65.

APPALACHIAN POWER EMPLOYEES had a capitalization ratio of 28.00 percent in our test, higher than the average for all credit unions, suggesting that it's more well prepared for financial trouble than its peers.

Asset Quality Score

This test's purpose is to try to understand how the credit union's loan loss reserves and overall capitalization could be affected by problem assets, such as past-due mortgages.

Having a large number of these types of assets may eventually force a credit union to use capital to cover losses, diminishing its equity buffer. 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.

On Bankrate's asset quality test, APPALACHIAN POWER EMPLOYEES scored 40 out of a possible 40 points, exceeding the national average of 38.09 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. A credit union can retain its earnings, boosting its capital buffer, or put them to work addressing problematic loans, potentially making the credit union more resilient in tough times. Conversely, losses lessen a credit union's ability to do those things.

APPALACHIAN POWER EMPLOYEES scored 2 out of a possible 30 on Bankrate's earnings test, coming in below the national average of 10.11.

One indication that APPALACHIAN POWER EMPLOYEES is outperforming its peers in this area was its earnings ratio of 0.00 percent in our test, higher 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.