Safe and Sound

DAWSON CO-OP

Dawson, MN
5
Star Rating
DAWSON CO-OP is a Dawson, MN-based, NCUA-insured credit union dating back to 1961. As of December 31, 2017, the credit union held assets of $163.6 million.

With 20 full-time employees, the credit union currently holds loans and leases worth $131.2 million. Its 5,926 members currently have $137.4 million in shares with the credit union.

Overall, Bankrate believes that, as of December 31, 2017, DAWSON CO-OP exhibited a superior condition, earning a full 5 stars for safety and soundness. Keep reading for an analysis of how the credit union did on the three major criteria Bankrate used to score U.S. credit unions on safety and soundness.

WHAT IS
SAFE AND SOUND?

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THE INSTITUTION'S SCORE

Capital Score

Capital acts as a bulwark against losses and as protection for members when a credit union is struggling financially. It follows then that an institution's level of capital is an important measurement of its financial fortitude. When looking at safety and soundness, the higher the capital, the better.

On our test to measure capital adequacy, DAWSON CO-OP racked up 22 out of a possible 30 points, above the national average of 15.65.

DAWSON CO-OP had a capitalization ratio of 22.00 percent in our test, higher than the average for all credit unions, suggesting that it could be more resilient in a crisis than its peers.

Asset Quality Score

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

A credit union with a large number of these kinds of assets may eventually be forced to use capital to absorb losses, reducing its equity buffer. It also means that there are likely to be many assets that are in non-accrual status and no longer earning interest for the credit union, pushing down earnings and elevating the risk of a future failure.

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

Troubled assets made up 0.00 percent of DAWSON CO-OP's total assets in our test, lower than the national average and potentially indicative of superior financial strength compared to other credit unions.

Earnings score

How successful a credit union is at earning money has an effect on its safety and soundness. Earnings may be retained by the credit union, expanding its capital buffer, or be used to address problematic loans, likely making the credit union better prepared to withstand economic shocks. Losses, on the other hand, take away from a credit union's ability to do those things.

DAWSON CO-OP scored 20 out of a possible 30 on Bankrate's test of earnings, beating the national average of 10.11.

One indication that the credit union is running ahead of its peers in this area was its earnings ratio of 0.00 percent in our test, better 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.