Safe and Sound

BEVERLY MUNICIPAL

BEVERLY, MA
5
Star Rating
BEVERLY, MA-based BEVERLY MUNICIPAL is an NCUA-insured credit union started in 1985. The credit union has assets of $11.0 million, according to December 31, 2017, regulatory filings.

Thanks to the efforts of 2 full-time employees, the credit union has amassed loans and leases worth $5.4 million. Its 1,551 members currently have $9.0 million in shares with the credit union.

Overall, Bankrate believes that, as of December 31, 2017, BEVERLY MUNICIPAL exhibited a superior condition, earning a full 5 stars for safety and soundness. Here's a breakdown of 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 works as a cushion against losses and as protection for members when a credit union is experiencing financial trouble. It follows then that an institution's level of capital is a crucial measurement of its financial resilience. From a safety and soundness perspective, the higher the capital, the better.

On our test to measure capital adequacy, BEVERLY MUNICIPAL scored 28 out of a possible 30 points, exceeding the national average of 15.65.

BEVERLY MUNICIPAL appears to be more well prepared for financial trouble than its peers, with a capitalization ratio of 28.00 percent in our test, higher than the average for all credit unions.

Asset Quality Score

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

A credit union with large numbers of these types of assets may eventually be required to use capital to cover losses, cutting down on its equity buffer. Many of those assets are also likely to be in non-accrual status and thus aren't earning money, reducing earnings and elevating the chances of a future failure.

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

The credit union's ratio of troubled assets was 0.00 percent in our test, less than the national average and suggestive of superior financial strength compared to other credit unions.

Earnings score

How successful a credit union is at making money has an effect on its long-term survivability. Earnings may be retained by the credit union, giving a boost to its capital cushion, or be used to deal with problematic loans, likely making the credit union more resilient in times of trouble. Conversely, losses lessen a credit union's ability to do those things.

BEVERLY MUNICIPAL underperformed the average on Bankrate's test of earnings, achieving a score of 6 out of a possible 30.

BEVERLY MUNICIPAL had an earnings ratio of 0.00 percent in our test, higher than the average for all credit unions, an indication 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.