Safe and Sound

DAKOTA PLAINS

Lemmon, SD
4
Star Rating
DAKOTA PLAINS is an NCUA-insured credit union founded in 1957 and currently headquartered in Lemmon, SD. As of December 31, 2017, the credit union held assets of $58.6 million.

With 21 full-time employees, the credit union holds loans and leases worth $44.3 million. DAKOTA PLAINS's 4,639 members currently have $51.3 million in shares with the credit union.

Overall, Bankrate believes that, as of December 31, 2017, DAKOTA PLAINS exhibited a good condition, earning 4 out of 5 stars for safety and soundness. Keep reading for an analysis of how the credit union faired on the three key 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 affords protection for members when a credit union is experiencing economic trouble. Therefore, a credit union's level of capital is an essential measurement of its financial fortitude. From a safety and soundness perspective, the higher the capital, the better.

DAKOTA PLAINS came in below the national average of 15.65 on our test to measure capital adequacy, racking up 8 out of a possible 30 points.

DAKOTA PLAINS's capitalization ratio of 8.00 percent in our test was worse than the average for all credit unions, an indication that it's weaker than its peers.

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 unpaid loans.

Having large numbers of these types of assets may eventually force a credit union to use capital to cover losses, reducing its cushion of equity. It also means that there are likely to be many assets that are in non-accrual status and no longer earning money, pushing down earnings and increasing the chances of a failure in the future.

DAKOTA PLAINS exceeded the national average of 38.09 on Bankrate's asset quality test, racking up 40 out of a possible 40 points .

A lower-than-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

A credit union's earnings performance affects its long-term survivability. Earnings can be retained by the credit union, increasing its capital cushion, or be used to deal with problematic loans, potentially making the credit union better able to withstand financial shocks. Losses, on the other hand, diminish a credit union's ability to do those things.

On Bankrate's test of earnings, DAKOTA PLAINS scored 8 out of a possible 30, coming in below the national average of 10.11.

One indication that DAKOTA PLAINS is outperforming its peers in this area was its earnings ratio of 0.00 percent in our test, above 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.