Safe and Sound

CHATTANOOGA FEDERAL EMPLOYEES

CHATTANOOGA, TN
5
Star Rating
CHATTANOOGA FEDERAL EMPLOYEES is an NCUA-insured credit union founded in 1925 and currently headquartered in CHATTANOOGA, TN. As of December 31, 2017, the credit union had assets of $45.5 million.

With 7 full-time employees, the credit union currently holds loans and leases worth $29.0 million. CHATTANOOGA FEDERAL EMPLOYEES's 2,637 members currently have $37.0 million in shares with the credit union.

Overall, Bankrate believes that, as of December 31, 2017, CHATTANOOGA FEDERAL EMPLOYEES exhibited a superior condition, earning a full 5 stars for safety and soundness. Keep reading for an analysis of how the credit union faired on the three important criteria Bankrate used to score U.S. 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 provides protection for members when a credit union is experiencing financial instability. It follows then that when it comes to measuring an an institution's financial resilience, capital is useful. When it comes to safety and soundness, more capital is preferred.

CHATTANOOGA FEDERAL EMPLOYEES scored 28 out of a possible 30 points on our test to measure the adequacy of a credit union's capital, better than the national average of 15.65.

CHATTANOOGA FEDERAL EMPLOYEES 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

Bankrate uses this test to estimate the effect of troubled assets, such as unpaid mortgages, on the credit union's loan loss reserves and overall capitalization.

Having extensive holdings of these kinds of assets may eventually force a credit union to use capital to absorb losses, reducing its equity cushion. It also means that there are likely to be many assets that are in non-accrual status and no longer earning money, decreasing earnings and increasing the risk of a failure in the future.

On Bankrate's asset quality test, CHATTANOOGA FEDERAL EMPLOYEES scored 40 out of a possible 40 points, above 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 greater financial strength than other credit unions.

Earnings score

A credit union's earnings performance affects its safety and soundness. A credit union can retain its earnings, boosting its capital buffer, or use them to deal with problematic loans, potentially making the credit union better prepared to withstand economic shocks. Obviously, credit unions that are losing money are less able to do those things.

CHATTANOOGA FEDERAL EMPLOYEES fell behind the national average on Bankrate's test of earnings, achieving a score of 10 out of a possible 30.

One indication that CHATTANOOGA FEDERAL EMPLOYEES is doing better than 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.