Safe and Sound

CLEARCHOICE

Wyomissing, PA
2
Star Rating
Started in 1957, CLEARCHOICE is an NCUA-insured credit union based in Wyomissing, PA. As of June 30, 2017, the credit union held assets of $16.0 million.

Thanks to the work of 5 full-time employees, the credit union holds loans and leases worth $11.5 million. CLEARCHOICE's 2,272 members currently have $15.1 million in shares with the credit union.

Overall, Bankrate believes that, as of June 30, 2017, CLEARCHOICE exhibited a below-average condition, earning 2 out of 5 stars for safety and soundness. Here's a breakdown of how the credit union did on the three major criteria Bankrate used to score U.S. credit unions.

WHAT IS
SAFE AND SOUND?

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THE INSTITUTION'S SCORE

Capital Score

Capital works as a cushion against losses and as protection for members when a credit union is experiencing economic instability. Therefore, when it comes to measuring an a credit union's financial stability, capital is valuable. When looking at safety and soundness, the higher the capital, the better.

CLEARCHOICE received a score of 2 out of a possible 30 points on our test to measure capital adequacy, falling short of the national average of 15.26.

CLEARCHOICE appears to be on less solid financial footing than its peers in this area, with a capitalization ratio of 6.00 percent in our test, worse than the average for all credit unions.

Asset Quality Score

This test's purpose is to try to understand how the credit union's capitalization and allocated loan loss reserves could be affected by troubled assets, such as past-due mortgages.

Having lots of these kinds of assets may eventually require a credit union to use capital to cover losses, shrinking its buffer of equity. Many of those assets are also likely to be in non-accrual status and no longer earning money, resulting in diminished earnings and potentially more risk of a failure in the future.

On Bankrate's asset quality test, CLEARCHOICE scored 40 out of a possible 40 points, exceeding the national average of 38.15 points.

A lower-than-average ratio of troubled assets of 2.00 percent in our test was potentially indicative of greater financial strength than other credit unions.

Earnings score

How successful a credit union is at earning money affects its safety and soundness. Earnings may be retained by the credit union, giving a boost to its capital cushion, or be used to address problematic loans, potentially making the credit union better able to withstand financial trouble. Losses, on the other hand, lessen a credit union's ability to do those things.

CLEARCHOICE scored 0 out of a possible 30 on Bankrate's earnings test, falling short of the national average of 10.31.

One sign that CLEARCHOICE is performing behind its peers in this area was its earnings ratio of -53.00 percent in our test, worse 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.