Safe and Sound

CANNON

CLOVIS, NM
2
Star Rating
CLOVIS, NM-based CANNON is an NCUA-insured credit union started in 1952. As of December 31, 2017, the credit union had assets of $64.3 million.

Members have $35.8 million on deposit tended by 19 full-time employees. With that footprint, the credit union currently holds loans and leases worth $35.8 million. Its 7,476 members currently have $59.3 million in shares with the credit union.

Overall, Bankrate believes that, as of December 31, 2017, CANNON exhibited a below-average condition, earning 2 out of 5 stars for safety and soundness. Here's a look at how the credit union faired on the three important criteria Bankrate used to score U.S. credit unions.

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THE INSTITUTION'S SCORE

Capital Score

When it comes to measuring a credit union's financial fortitude, capital is important. It works as a cushion against losses and affords protection for members when a credit union is struggling financially. From a safety and soundness perspective, the higher the capital, the better.

CANNON scored below the national average of 15.65 on our test to measure capital adequacy, racking up 6 out of a possible 30 points.

CANNON appears to be less well prepared for financial trouble than its peers in this area, with a capitalization ratio of 6.00 percent in our test, below the average for all credit unions.

Asset Quality Score

This test's purpose is to try to understand how the credit union's reserves set aside to cover loan losses, as well as overall capitalization could be affected by troubled assets, such as unpaid mortgages.

Having large numbers of these types of assets may eventually force a credit union to use capital to absorb losses, decreasing its buffer of equity. It also means that there are likely to be many assets that are in non-accrual status and thus aren't earning money, resulting in diminished earnings and potentially more risk of a failure in the future.

CANNON scored 36 out of a possible 40 points on Bankrate's asset quality test, failing to reach the national average of 38.09.

Troubled assets made up 0.00 percent of CANNON's total assets in our test, lower than the national average and suggestive of greater financial strength than other credit unions.

Earnings score

A credit union's ability to earn money has an effect on its safety and soundness. A credit union can retain its earnings, boosting its capital buffer, or put them to work addressing problematic loans, potentially making the credit union more resilient in tough times. Credit unions that are losing money, however, have less ability to do those things.

CANNON scored 2 out of a possible 30 on Bankrate's test of earnings, falling short of the national average of 10.11.

CANNON had an earnings ratio of 0.00 percent in our test, higher than the average for all credit unions, a sign 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.