Safe and Sound

BENCHMARK

West Chester, PA
4
Star Rating
West Chester, PA-based BENCHMARK is an NCUA-insured credit union founded in 1940. As of December 31, 2017, the credit union held assets of $219.4 million.

Thanks to the work of 35 full-time employees, the credit union holds loans and leases worth $163.4 million. Its 12,507 members currently have $188.9 million in shares with the credit union.

Overall, Bankrate believes that, as of December 31, 2017, BENCHMARK exhibited a good condition, earning 4 out of 5 stars for safety and soundness. Here's a look at how the credit union did on the three key criteria Bankrate used to evaluate American credit unions.

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THE INSTITUTION'S SCORE

Capital Score

Capital works as a buffer against losses and as protection for members during times of financial instability for the credit union. Therefore, when it comes to measuring an an institution's financial resilience, capital is valuable. When it comes to safety and soundness, the higher the capital, the better.

BENCHMARK scored 18 out of a possible 30 points on our test to measure capital adequacy, exceeding the national average of 15.65.

BENCHMARK's capitalization ratio of 18.00 percent in our test was better than the average for all credit unions, an indication that it's on more solid financial footing than its peers.

Asset Quality Score

Bankrate uses this test to determine the impact of problem assets, such as unpaid loans, on the credit union's reserves set aside to cover loan losses, as well as overall capitalization.

A credit union with extensive holdings of these kinds of assets could eventually be forced to use capital to absorb losses, decreasing its equity buffer. Many of those assets are also likely to be in non-accrual status and no longer earning money, resulting in reduced earnings and potentially more risk of a failure in the future.

BENCHMARK exceeded the national average of 38.09 on Bankrate's asset quality test, racking up 40 out of a possible 40 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

How successful a credit union is at earning money has an effect on its safety and soundness. A credit union can retain its earnings, boosting its capital cushion, or use them to deal with problematic loans, likely making the credit union better prepared to withstand economic shocks. Obviously, credit unions that are losing money are less able to do those things.

On Bankrate's earnings test, BENCHMARK scored 0 out of a possible 30, less than the national average of 10.11.

One indication that BENCHMARK is doing better than 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.