Safe and Sound

COMMONWEALTH

Bourbonnais, IL
4
Star Rating
COMMONWEALTH is an NCUA-insured credit union started in 1951 and currently based in Bourbonnais, IL. The credit union has assets of $79.8 million, according to December 31, 2017, regulatory filings.

Thanks to the efforts of 21 full-time employees, the credit union currently holds loans and leases worth $62.6 million. COMMONWEALTH's 10,440 members currently have $68.8 million in shares with the credit union.

Overall, Bankrate believes that, as of December 31, 2017, COMMONWEALTH exhibited a good condition, earning 4 out of 5 stars for safety and soundness. Here's a breakdown of how the credit union faired on the three major criteria Bankrate used to score U.S. credit unions.

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THE INSTITUTION'S SCORE

Capital Score

Capital works as a buffer against losses and affords protection for members when a credit union is struggling financially. Therefore, when it comes to measuring an an institution's financial resilience, capital is valuable. From a safety and soundness perspective, the more capital, the better.

COMMONWEALTH received a score of 10 out of a possible 30 points on our test to measure capital adequacy, failing to reach the national average of 15.65.

COMMONWEALTH's capitalization ratio of 10.00 percent in our test was less than the average for all credit unions, suggesting that it's weaker than its peers.

Asset Quality Score

In this test, Bankrate tries to estimate the impact of problem assets, such as past-due loans, on the credit union's capitalization and allocated loan loss reserves.

A credit union with extensive holdings of these kinds of assets could eventually have to use capital to absorb losses, shrinking its buffer of equity. Many of those assets are also likely to be in non-accrual status and no longer earning money, decreasing earnings and elevating the chances of a future failure.

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

Troubled assets made up 0.00 percent of COMMONWEALTH's total assets in our test, less than the national average and suggestive of superior financial strength compared to other credit unions.

Earnings score

A credit union's earnings performance has an effect on its safety and soundness. A credit union can retain its earnings, giving a boost to its capital buffer, or use them to address problematic loans, potentially making the credit union better able to withstand financial shocks. Conversely, losses lessen a credit union's ability to do those things.

COMMONWEALTH scored 10 out of a possible 30 on Bankrate's test of earnings, failing to reach the national average of 10.11.

COMMONWEALTH had an earnings ratio of 0.00 percent in our test, above 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.