Safe and Sound

CEDAR FALLS COMMUNITY

CEDAR FALLS, IA
5
Star Rating
CEDAR FALLS COMMUNITY is an NCUA-insured credit union started in 1958 and currently based in CEDAR FALLS, IA. Regulatory filings show the credit union having assets of $119.1 million, as of December 31, 2017.

Thanks to the work of 16 full-time employees, the credit union has amassed loans and leases worth $85.5 million. CEDAR FALLS COMMUNITY's 8,192 members currently have $100.9 million in shares with the credit union.

Overall, Bankrate believes that, as of December 31, 2017, CEDAR FALLS COMMUNITY exhibited a superior condition, earning a full 5 stars for safety and soundness. Here's a breakdown of how the credit union faired on the three key criteria Bankrate used to grade American credit unions on safety and soundness.

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THE INSTITUTION'S SCORE

Capital Score

When it comes to measuring a credit union's financial strength, capital is essential. It works as a cushion against losses and affords protection for members when a credit union is struggling financially. When it comes to safety and soundness, more capital is preferred.

CEDAR FALLS COMMUNITY beat out the national average of 15.65 points on our test to measure capital adequacy, achieving a score of 20 out of a possible 30 points.

CEDAR FALLS COMMUNITY appears to be stronger than its peers, with a capitalization ratio of 20.00 percent in our test, better than the average for all credit unions.

Asset Quality Score

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

Having extensive holdings of these types of assets may eventually force a credit union to use capital to cover losses, cutting down on its equity cushion. Many of those assets are also likely to be in non-accrual status and no longer earning money, decreasing earnings and elevating the risk of a failure in the future.

On Bankrate's test of asset quality, CEDAR FALLS COMMUNITY scored 40 out of a possible 40 points, beating the national average of 38.09 points.

Troubled assets made up 0.00 percent of the credit union's total assets 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 affects its safety and soundness. A credit union can retain its earnings, expanding its capital buffer, or put them to work addressing problematic loans, likely making the credit union better prepared to withstand economic shocks. However, credit unions that are losing money are less able to do those things.

CEDAR FALLS COMMUNITY received above-average marks on Bankrate's earnings test, achieving a score of 18 out of a possible 30.

One indication that the credit union is doing better than its peers in this area was its earnings ratio of 0.00 percent in our test, better 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.