Safe and Sound

COMMONWEALTH

Frankfort, KY
5
Star Rating
Started in 1951, COMMONWEALTH is an NCUA-insured credit union based in Frankfort, KY. Regulatory filings show the credit union having assets of $1.15 billion, as of December 31, 2017.

Thanks to the efforts of 282 full-time employees, the credit union holds loans and leases worth $827.1 million. Its 93,043 members currently have $944.6 million in shares with the credit union.

Overall, Bankrate believes that, as of December 31, 2017, COMMONWEALTH exhibited a superior condition, earning a full 5 stars for safety and soundness. Keep reading for a breakdown of how the credit union did on the three key criteria Bankrate used to evaluate American credit unions on safety and soundness.

WHAT IS
SAFE AND SOUND?

Find out

THE INSTITUTION'S SCORE

Capital Score

Capital is a valuable measurement of a credit union's financial resilience. It works as a bulwark against losses and provides protection for members when a credit union is struggling financially. When looking at safety and soundness, more capital is better.

On our test to measure capital adequacy, COMMONWEALTH achieved a score of 16 out of a possible 30 points, above the national average of 15.65.

COMMONWEALTH's capitalization ratio of 16.00 percent in our test puts it right in line with the average for all credit unions.

Asset Quality Score

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

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

COMMONWEALTH 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 problem 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 affects its safety and soundness. A credit union can retain its earnings, boosting its capital cushion, or use them to address problematic loans, likely making the credit union better prepared to withstand financial shocks. Credit unions that are losing money, however, have less ability to do those things.

COMMONWEALTH scored 16 out of a possible 30 on Bankrate's earnings test, beating out 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.