Safe and Sound

BURLINGTON MUNICIPAL EMPLOYEES

Burlington, IA
3
Star Rating
BURLINGTON MUNICIPAL EMPLOYEES is a Burlington, IA-based, NCUA-insured credit union started in 1939. Regulatory filings show the credit union having $5.4 million in assets, as of December 31, 2017.

The credit union has amassed loans and leases worth $3.3 million. Its 624 members currently have $4.9 million in shares with the credit union.

Overall, Bankrate believes that, as of December 31, 2017, BURLINGTON MUNICIPAL EMPLOYEES exhibited a generally satisfactory condition, earning 3 out of 5 stars for safety and soundness. Here's a breakdown of how the credit union did on the three major criteria Bankrate used to score American credit unions.

WHAT IS
SAFE AND SOUND?

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THE INSTITUTION'S SCORE

Capital Score

Capital acts as a buffer against losses and as protection for members during times of economic instability for the credit union. It follows then that when it comes to measuring an a credit union's financial fortitude, capital is useful. When looking at safety and soundness, more capital is better.

BURLINGTON MUNICIPAL EMPLOYEES received a score of 10 out of a possible 30 points on our test to measure capital adequacy, falling short of the national average of 15.65.

BURLINGTON MUNICIPAL EMPLOYEES's capitalization ratio of 10.00 percent in our test was worse than the average for all credit unions, an indication that it's weaker than its peers.

Asset Quality Score

Bankrate uses this test to determine the effect of troubled assets, such as past-due loans, on the credit union's capitalization and allocated loan loss reserves.

A credit union with lots of these types of assets could eventually be forced to use capital to absorb losses, cutting down on its buffer of equity. Many of those assets are also likely to be in non-accrual status and thus aren't earning interest for the credit union, reducing earnings and elevating the risk of a failure in the future.

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

BURLINGTON MUNICIPAL EMPLOYEES's ratio of problem assets was 0.00 percent in our test, lower than the national average and suggestive 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. Earnings may be retained by the credit union, boosting its capital buffer, or be used to address problematic loans, likely making the credit union more resilient in tough times. Losses, on the other hand, take away from a credit union's ability to do those things.

BURLINGTON MUNICIPAL EMPLOYEES scored 0 out of a possible 30 on Bankrate's earnings test, below the national average of 10.11.

BURLINGTON MUNICIPAL EMPLOYEES had an earnings ratio of 0.00 percent in our test, above the average for all credit unions, an indication 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.