Safe and Sound

CHATTANOOGA FIRST

CHATTANOOGA, TN
5
Star Rating
CHATTANOOGA, TN-based CHATTANOOGA FIRST is an NCUA-insured credit union founded in 1961. As of December 31, 2017, the credit union held assets of $21.1 million.

With 4 full-time employees, the credit union holds loans and leases worth $13.1 million. CHATTANOOGA FIRST's 2,373 members currently have $16.0 million in shares with the credit union.

Overall, Bankrate believes that, as of December 31, 2017, CHATTANOOGA FIRST exhibited a superior condition, earning a full 5 stars for safety and soundness. Here's an analysis of how the credit union did on the three major criteria Bankrate used to evaluate American credit unions on safety and soundness.

WHAT IS
SAFE AND SOUND?

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THE INSTITUTION'S SCORE

Capital Score

Capital is an essential measurement of a credit union's financial strength. It acts as a cushion against losses and as protection for members when a credit union is experiencing economic trouble. When looking at safety and soundness, the more capital, the better.

CHATTANOOGA FIRST scored 30 out of a possible 30 points on our test to measure the adequacy of a credit union's capital, beating the national average of 15.65.

CHATTANOOGA FIRST's capitalization ratio of 30.00 percent in our test was better than the average for all credit unions, suggesting that it's more well prepared for financial trouble than its peers.

Asset Quality Score

In this test, Bankrate tries to determine the effect of troubled assets, such as past-due mortgages, 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 cover losses, shrinking its equity buffer. Many of those assets are also likely to be in non-accrual status and thus aren't earning money, pushing down earnings and increasing the chances of a failure in the future.

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

A below-average ratio of troubled assets of 0.00 percent in our test was potentially indicative of greater financial strength than other credit unions.

Earnings score

How successful a credit union is at making money has an effect on its long-term survivability. Earnings can be retained by the credit union, boosting its capital buffer, or be used to address problematic loans, potentially making the credit union better able to withstand financial shocks. Obviously, credit unions that are losing money have less ability to do those things.

On Bankrate's earnings test, CHATTANOOGA FIRST scored 4 out of a possible 30, falling short of the national average of 10.11.

CHATTANOOGA FIRST had an earnings ratio of 0.00 percent in our test, better than the average for all credit unions, suggesting that it's running ahead of 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.