Safe and Sound

DERRY AREA

Derry, PA
4
Star Rating
DERRY AREA is a Derry, PA-based, NCUA-insured credit union dating back to 1949. As of December 31, 2017, the credit union had assets of $9.3 million.

Members have $5.1 million on deposit tended by 4 full-time employees. With that footprint, the credit union holds loans and leases worth $5.1 million. DERRY AREA's 2,022 members currently have $8.0 million in shares with the credit union.

Overall, Bankrate believes that, as of December 31, 2017, DERRY AREA exhibited a good condition, earning 4 out of 5 stars for safety and soundness. Here's a breakdown of how the credit union faired on the three key criteria Bankrate used to score U.S. credit unions.

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THE INSTITUTION'S SCORE

Capital Score

Capital is a valuable measurement of a credit union's financial resilience. It works as a cushion against losses and affords protection for members during times of financial trouble for the credit union. When looking at safety and soundness, the higher the capital, the better.

DERRY AREA did better than the national average of 15.65 points on our test to measure capital adequacy, racking up 16 out of a possible 30 points.

DERRY AREA'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 is intended to try to understand 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 unpaid loans.

A credit union with lots of these kinds of assets may eventually be forced to use capital to absorb losses, cutting down on its equity buffer. Many of those assets are also likely to be in non-accrual status and thus aren't earning interest for the credit union, resulting in lower earnings and potentially more risk of a future failure.

On Bankrate's test of asset quality, DERRY AREA scored 40 out of a possible 40 points, beating the national average of 38.09 points.

A below-average ratio of troubled 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 has an effect on its long-term survivability. Earnings can be retained by the credit union, giving a boost to its capital cushion, or be used to address problematic loans, potentially making the credit union more resilient in tough times. Conversely, losses reduce a credit union's ability to do those things.

DERRY AREA fell behind the national average on Bankrate's test of earnings, achieving a score of 0 out of a possible 30.

The credit union had an earnings ratio of 0.00 percent in our test, better than the average for all credit unions, an indication that it's doing better than 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.