Safe and Sound

ARIZONA

PHOENIX, AZ
5
Star Rating
ARIZONA is an NCUA-insured credit union founded in 1936 and currently headquartered in PHOENIX, AZ. The credit union has $1.54 billion in assets, according to December 31, 2017, regulatory filings.

Members have $729.4 million on deposit tended by 406 full-time employees. With that footprint, the credit union currently holds loans and leases worth $729.4 million. Its 119,474 members currently have $1.26 billion in shares with the credit union.

Overall, Bankrate believes that, as of December 31, 2017, ARIZONA exhibited a superior condition, earning a full 5 stars for safety and soundness. Here's a look at how the credit union did on the three important criteria Bankrate used to grade American credit unions on safety and soundness.

WHAT IS
SAFE AND SOUND?

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THE INSTITUTION'S SCORE

Capital Score

Capital is a key measurement of a credit union's financial fortitude. It works as a bulwark against losses and affords protection for members during periods of financial instability for the credit union. When looking at safety and soundness, the higher the capital, the better.

ARIZONA achieved a score of 22 out of a possible 30 points on our test to measure the adequacy of a credit union's capital, better than the national average of 15.65.

ARIZONA had a capitalization ratio of 22.00 percent in our test, above the average for all credit unions, a sign that it's more well prepared for financial trouble than its peers.

Asset Quality Score

This test is intended to estimate how the credit union's capitalization and allocated loan loss reserves could be affected by troubled assets, such as past-due mortgages.

Having large numbers of these kinds of assets means a credit union could have to use capital to cover losses, reducing its cushion of equity. It also means that there are likely to be many assets that are in non-accrual status and no longer earning money, resulting in depressed earnings and potentially more risk of a failure in the future.

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

A below-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

How successful a credit union is at making money has an effect on its safety and soundness. Earnings may be retained by the credit union, expanding its capital buffer, or be used to address problematic loans, likely making the credit union better able to withstand economic trouble. Conversely, losses diminish a credit union's ability to do those things.

ARIZONA outperformed the average on Bankrate's earnings test, achieving a score of 20 out of a possible 30.

ARIZONA 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.