Safe and Sound

ARAPAHOE

CENTENNIAL, CO
4
Star Rating
Started in 1938, ARAPAHOE is an NCUA-insured credit union headquartered in CENTENNIAL, CO. As of December 31, 2017, the credit union had assets of $124.6 million.

Thanks to the work of 33 full-time employees, the credit union holds loans and leases worth $77.5 million. Its 9,396 members currently have $113.2 million in shares with the credit union.

Overall, Bankrate believes that, as of December 31, 2017, ARAPAHOE exhibited a good condition, earning 4 out of 5 stars for safety and soundness. Keep reading for a look at how the credit union did on the three key 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 a valuable measurement of an institution's financial strength. It works as a buffer against losses and affords protection for members when a credit union is experiencing economic instability. When it comes to safety and soundness, the more capital, the better.

On our test to measure the adequacy of a credit union's capital, ARAPAHOE received a score of 8 out of a possible 30 points, lower than the national average of 15.65.

ARAPAHOE had a capitalization ratio of 8.00 percent in our test, worse than the average for all credit unions, suggesting that it's less well prepared for financial trouble than its peers.

Asset Quality Score

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

Having extensive holdings of these types of assets could eventually require a credit union to use capital to cover losses, diminishing its equity cushion. Many of those assets are also likely to be in non-accrual status and thus aren't earning money, diminishing earnings and increasing the risk of a failure in the future.

On Bankrate's test of asset quality, ARAPAHOE scored 40 out of a possible 40 points, better than the national average of 38.09 points.

Troubled assets made up 0.00 percent of the credit union's total assets in our test, lower than the national average and potentially indicative of greater financial strength than other credit unions.

Earnings score

How successful a credit union is at earning money affects its safety and soundness. Earnings may be retained by the credit union, boosting its capital cushion, or be used to address problematic loans, potentially making the credit union better able to withstand financial trouble. Obviously, credit unions that are losing money are less able to do those things.

ARAPAHOE scored 12 out of a possible 30 on Bankrate's earnings test, beating out the national average of 10.11.

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