Safe and Sound

ARMCO

Butler, PA
5
Star Rating
Founded in 1935, ARMCO is an NCUA-insured credit union based in BUTLER, PA. As of December 31, 2017, the credit union had assets of $333.3 million.

Members have $216.9 million on deposit tended by 49 full-time employees. With that footprint, the credit union holds loans and leases worth $216.9 million. Its 29,338 members currently have $280.7 million in shares with the credit union.

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

WHAT IS
SAFE AND SOUND?

Find out

THE INSTITUTION'S SCORE

Capital Score

Capital acts as a cushion against losses and as protection for members during times of economic instability for the credit union. It follows then that a credit union's level of capital is an important measurement of its financial strength. When looking at safety and soundness, more capital is better.

ARMCO exceeded the national average of 15.65 points on our test to measure capital adequacy, racking up 22 out of a possible 30 points.

ARMCO had a capitalization ratio of 22.00 percent in our test, better 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 troubled assets, such as past-due loans.

A credit union with lots of these kinds of assets may eventually have to use capital to absorb losses, decreasing its buffer of equity. Many of those assets are also likely to be in non-accrual status and thus aren't earning money, resulting in diminished earnings and potentially more risk of a failure in the future.

ARMCO scored 40 out of a possible 40 points on Bankrate's test of asset quality, beating the national average of 38.09.

A below-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 ability to earn money has an effect on its safety and soundness. Earnings can be retained by the credit union, expanding its capital cushion, or be used to address problematic loans, potentially making the credit union better able to withstand economic shocks. However, credit unions that are losing money are less able to do those things.

On Bankrate's earnings test, ARMCO scored 14 out of a possible 30, beating the national average of 10.11.

ARMCO had an earnings ratio of 0.00 percent in our test, higher than the average for all credit unions, a sign that it's outperforming 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.