Safe and Sound

EATON EMPLOYEES

SPENCER, IA
NR
Star Rating
Started in 1977, EATON EMPLOYEES is an NCUA-insured credit union based in SPENCER, IA. As of June 30, 2017, the credit union had assets of $2.0 million.

EATON EMPLOYEES's 300 members currently have $1.8 million in shares with the credit union. With that footprint, the credit union has amassed loans and leases worth $1.6 million.

Overall, Bankrate believes that, as of June 30, 2017, EATON EMPLOYEES exhibited a significantly below-average condition, earning 1 out of 5 stars for safety and soundness. Keep reading for a breakdown of how the credit union did on the three key criteria Bankrate used to evaluate U.S. credit unions.

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THE INSTITUTION'S SCORE

Capital Score

When it comes to measuring an institution's financial resilience, capital is essential. It acts as a buffer against losses and affords protection for members when a credit union is experiencing financial instability. When it comes to safety and soundness, the higher the capital, the better.

On our test to measure capital adequacy, EATON EMPLOYEES scored 16 out of a possible 30 points, beating the national average of 15.26.

EATON EMPLOYEES had a capitalization ratio of 12.00 percent in our test, below the average for all credit unions, suggesting that it could have a harder time weathering financial trouble than its peers.

Asset Quality Score

This test is intended to estimate how the credit union's capitalization and allocated loan loss reserves could be affected by troubled assets, such as past-due mortgages.

A credit union with lots of these types of assets could eventually be forced to use capital to absorb losses, reducing its buffer of equity. It also means that there are likely to be many assets that are in non-accrual status and no longer earning money, pushing down earnings and increasing the risk of a future failure.

EATON EMPLOYEES fell below the national average of 38.15 on Bankrate's asset quality test, racking up 8 out of a possible 40 points .

EATON EMPLOYEES's ratio of problem assets was 67.00 percent in our test, above the national average and something to keep an eye on.

Earnings score

How successful a credit union is at making money affects its safety and soundness. A credit union can retain its earnings, giving a boost to its capital buffer, or put them to work addressing problematic loans, likely making the credit union better able to withstand financial trouble. Credit unions that are losing money, however, are less able to do those things.

On Bankrate's earnings test, EATON EMPLOYEES scored 4 out of a possible 30, lower than the national average of 10.31.

EATON EMPLOYEES had an earnings ratio of 1.00 percent in our test, equal to the average for all credit unions, suggesting that it's running neck and neck with 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.