Safe and Sound

DEPARTMENT OF CORRECTIONS

Baton Rouge, LA
5
Star Rating
DEPARTMENT OF CORRECTIONS is an NCUA-insured credit union founded in 1957 and currently headquartered in Baton Rouge, LA. Regulatory filings show the credit union having $78.6 million in assets, as of December 31, 2017.

With 43 full-time employees, the credit union holds loans and leases worth $53.6 million. DEPARTMENT OF CORRECTIONS's 13,248 members currently have $63.1 million in shares with the credit union.

Overall, Bankrate believes that, as of December 31, 2017, DEPARTMENT OF CORRECTIONS exhibited a superior condition, earning a full 5 stars for safety and soundness. Here's a look at how the credit union faired on the three important 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 works as a cushion against losses and provides protection for members when a credit union is experiencing financial trouble. Therefore, an institution's level of capital is a valuable measurement of its financial resilience. When it comes to safety and soundness, more capital is preferred.

DEPARTMENT OF CORRECTIONS scored above the national average of 15.65 points on our test to measure capital adequacy, achieving a score of 30 out of a possible 30 points.

DEPARTMENT OF CORRECTIONS had a capitalization ratio of 30.00 percent in our test, higher than the average for all credit unions, a sign that it could be more resilient in a crisis than its peers.

Asset Quality Score

This test is intended to try to understand how the credit union's loan loss reserves and overall capitalization could be affected by problem assets, such as unpaid mortgages.

A credit union with a large number of these kinds of assets could eventually be required to use capital to cover 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, reducing earnings and elevating the risk of a failure in the future.

DEPARTMENT OF CORRECTIONS scored 40 out of a possible 40 points on Bankrate's test of asset quality, better than the national average of 38.09.

The credit union's ratio of problem assets was 0.00 percent in our test, less than the national average and potentially indicative of greater financial strength than other credit unions.

Earnings score

A credit union's profitability affects its long-term survivability. A credit union can retain its earnings, increasing its capital buffer, or use them to address problematic loans, potentially making the credit union better able to withstand financial trouble. However, credit unions that are losing money have less ability to do those things.

On Bankrate's earnings test, DEPARTMENT OF CORRECTIONS scored 16 out of a possible 30, beating the national average of 10.11.

One indication that DEPARTMENT OF CORRECTIONS 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.