Safe and Sound

DISCOVERY

WYOMISSING, PA
4
Star Rating
DISCOVERY is an NCUA-insured credit union started in 1959 and currently based in WYOMISSING, PA. As of December 31, 2017, the credit union held assets of $129.8 million.

Members have $71.6 million on deposit tended by 19 full-time employees. With that footprint, the credit union currently holds loans and leases worth $71.6 million. Its 9,141 members currently have $113.8 million in shares with the credit union.

Overall, Bankrate believes that, as of December 31, 2017, DISCOVERY exhibited a good condition, earning 4 out of 5 stars for safety and soundness. Keep reading for a look at how the credit union did on the three important criteria Bankrate used to score U.S. credit unions.

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THE INSTITUTION'S SCORE

Capital Score

Capital acts as a bulwark against losses and provides protection for members during periods of financial instability for the credit union. Therefore, when it comes to measuring an an institution's financial stability, capital is valuable. When it comes to safety and soundness, the higher the capital, the better.

DISCOVERY received a score of 14 out of a possible 30 points on our test to measure capital adequacy, less than the national average of 15.65.

DISCOVERY's capitalization ratio of 14.00 percent in our test was lower than the average for all credit unions, an indication that it's on less solid financial footing than its peers.

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 past-due loans.

Having lots of these kinds of assets suggests a credit union may eventually have to use capital to cover losses, reducing its buffer of equity. It also means that there are likely to be many assets that are in non-accrual status and thus aren't earning money, resulting in depressed earnings and potentially more risk of a future failure.

DISCOVERY scored 40 out of a possible 40 points on Bankrate's test of asset quality, above the national average of 38.09.

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

How successful a credit union is at earning money affects its long-term survivability. Earnings can be retained by the credit union, expanding its capital cushion, or be used to deal with problematic loans, likely making the credit union better able to withstand financial trouble. However, credit unions that are losing money have less ability to do those things.

DISCOVERY did above-average on Bankrate's earnings test, achieving a score of 12 out of a possible 30.

DISCOVERY had an earnings ratio of 0.00 percent in our test, above the average for all credit unions, suggesting that it's beating 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.