Safe and Sound

DEMOPOLIS

DEMOPOLIS, AL
3
Star Rating
DEMOPOLIS is an NCUA-insured credit union started in 1966 and currently headquartered in DEMOPOLIS, AL. The credit union holds $667,980 in assets, according to December 31, 2017, regulatory filings.

The credit union holds loans and leases worth $577,440. DEMOPOLIS's 784 members currently have $544,817 in shares with the credit union.

Overall, Bankrate believes that, as of December 31, 2017, DEMOPOLIS exhibited a generally satisfactory condition, earning 3 out of 5 stars for safety and soundness. Keep reading for a breakdown of how the credit union faired on the three important 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 as protection for members during times of financial instability for the credit union. It follows then that when it comes to measuring an a credit union's financial fortitude, capital is key. When it comes to safety and soundness, the higher the capital, the better.

On our test to measure the adequacy of a credit union's capital, DEMOPOLIS received a score of 12 out of a possible 30 points, lower than the national average of 15.65.

DEMOPOLIS had a capitalization ratio of 12.00 percent in our test, below the average for all credit unions, suggesting that it's weaker than its peers.

Asset Quality Score

This test is intended to estimate how the credit union's reserves set aside to cover loan losses, as well as overall capitalization could be affected by troubled assets, such as past-due loans.

Having lots of these types of assets could eventually require a credit union to use capital to absorb losses, cutting down on its equity cushion. It also means that there are likely to be many assets that are in non-accrual status and no longer earning money, diminishing earnings and increasing the risk of a failure in the future.

DEMOPOLIS came in below the national average of 38.09 on Bankrate's test of asset quality, racking up 12 out of a possible 40 points .

The credit union's ratio of problem assets was 1.00 percent in our test, the same as the national average.

Earnings score

How successful a credit union is at making 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 deal with problematic loans, potentially making the credit union more resilient in times of trouble. However, credit unions that are losing money are less able to do those things.

DEMOPOLIS received above-average marks on Bankrate's test of earnings, achieving a score of 28 out of a possible 30.

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