Safe and Sound

BIG SKY

BILLINGS, MT
4
Star Rating
BIG SKY is an NCUA-insured credit union founded in 1963 and currently based in BILLINGS, MT. The credit union holds $8.5 million in assets, according to December 31, 2017, regulatory filings.

With 2 full-time employees, the credit union has amassed loans and leases worth $2.9 million. BIG SKY's 917 members currently have $7.6 million in shares with the credit union.

Overall, Bankrate believes that, as of December 31, 2017, BIG SKY exhibited a good condition, earning 4 out of 5 stars for safety and soundness. Keep reading for a breakdown of how the credit union faired on the three key criteria Bankrate used to grade U.S. credit unions.

WHAT IS
SAFE AND SOUND?

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THE INSTITUTION'S SCORE

Capital Score

Capital works as a buffer against losses and provides protection for members when a credit union is struggling financially. Therefore, when it comes to measuring an a credit union's financial stability, capital is essential. From a safety and soundness perspective, the more capital, the better.

On our test to measure capital adequacy, BIG SKY received a score of 12 out of a possible 30 points, coming in below the national average of 15.65.

BIG SKY's capitalization ratio of 12.00 percent in our test was below the average for all credit unions, a sign that it's less well prepared for financial trouble than its peers.

Asset Quality Score

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

Having large numbers of these kinds of assets could eventually require a credit union to use capital to absorb losses, cutting down on its buffer of equity. It also means that there are likely to be many assets that are in non-accrual status and no longer earning money, pushing down earnings and elevating the risk of a failure in the future.

BIG SKY did better than the national average of 38.09 on Bankrate's test of asset quality, racking up 40 out of a possible 40 points .

Earnings score

How successful a credit union is at making money has an effect on its safety and soundness. Earnings can be retained by the credit union, increasing its capital cushion, or be used to address problematic loans, likely making the credit union better prepared to withstand financial trouble. Credit unions that are losing money, however, have less ability to do those things.

On Bankrate's earnings test, BIG SKY scored 4 out of a possible 30, lower than the national average of 10.11.

One indication that BIG SKY is outperforming its peers in this area was its earnings ratio of 0.00 percent in our test, above 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.