Safe and Sound

CITY

TUSCALOOSA, AL
5
Star Rating
CITY is a TUSCALOOSA, AL-based, NCUA-insured credit union dating back to 1950. Regulatory filings show the credit union having $18.4 million in assets, as of December 31, 2017.

With 6 full-time employees, the credit union currently holds loans and leases worth $8.1 million. Its 2,545 members currently have $14.6 million in shares with the credit union.

Overall, Bankrate believes that, as of December 31, 2017, CITY exhibited a superior condition, earning a full 5 stars for safety and soundness. Keep reading for a look at how the credit union faired on the three important criteria Bankrate used to evaluate U.S. credit unions on safety and soundness.

WHAT IS
SAFE AND SOUND?

Find out

THE INSTITUTION'S SCORE

Capital Score

Capital acts as a cushion against losses and affords protection for members when a credit union is struggling financially. Therefore, a credit union's level of capital is a crucial measurement of its financial fortitude. When it comes to safety and soundness, the higher the capital, the better.

CITY exceeded the national average of 15.65 points on our test to measure capital adequacy, receiving a score of 30 out of a possible 30 points.

CITY's capitalization ratio of 30.00 percent in our test was better than the average for all credit unions, a sign that it's on more solid financial footing than its peers.

Asset Quality Score

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

Having extensive holdings of these types of assets suggests a credit union may have to use capital to absorb 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, diminishing earnings and elevating the risk of a future failure.

On Bankrate's asset quality test, CITY scored 40 out of a possible 40 points, above the national average of 38.09 points.

A below-average ratio of problem assets of 0.00 percent in our test was potentially indicative of superior financial strength compared to other credit unions.

Earnings score

A credit union's earnings performance affects its long-term survivability. 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. However, credit unions that are losing money are less able to do those things.

On Bankrate's earnings test, CITY scored 4 out of a possible 30, coming in below the national average of 10.11.

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