Safe and Sound

EL PASO AREA TEACHERS

EL PASO, TX
4
Star Rating
EL PASO AREA TEACHERS is an EL PASO, TX-based, NCUA-insured credit union founded in 1936. As of December 31, 2017, the credit union held assets of $633.2 million.

Thanks to the work of 211 full-time employees, the credit union holds loans and leases worth $410.3 million. Its 57,876 members currently have $552.6 million in shares with the credit union.

Overall, Bankrate believes that, as of December 31, 2017, EL PASO AREA TEACHERS exhibited a good condition, earning 4 out of 5 stars for safety and soundness. Here's an analysis of how the credit union did on the three key criteria Bankrate used to grade U.S. credit unions.

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THE INSTITUTION'S SCORE

Capital Score

Capital acts as a buffer against losses and as protection for members during times of financial trouble for the credit union. Therefore, an institution's level of capital is a crucial measurement of its financial resilience. When looking at safety and soundness, the more capital, the better.

EL PASO AREA TEACHERS scored 16 out of a possible 30 points on our test to measure the adequacy of a credit union's capital, beating the national average of 15.65.

EL PASO AREA TEACHERS had a capitalization ratio of 16.00 percent in our test, the same as the average for all credit unions, an indication that it's running neck and neck with its peers.

Asset Quality Score

Bankrate uses this test to determine the impact of problem assets, such as unpaid mortgages, on the credit union's loan loss reserves and overall capitalization.

A credit union with lots of these kinds of assets could eventually be forced to use capital to cover losses, reducing its cushion of equity. Many of those assets are also likely to be in non-accrual status and thus aren't earning money, diminishing earnings and elevating the risk of a failure in the future.

EL PASO AREA TEACHERS scored 40 out of a possible 40 points on Bankrate's test of asset quality, exceeding 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

A credit union's earnings performance has an effect on its long-term survivability. A credit union can retain its earnings, expanding its capital buffer, or put them to work addressing problematic loans, likely making the credit union more resilient in times of trouble. However, credit unions that are losing money have less ability to do those things.

EL PASO AREA TEACHERS fell behind the national average on Bankrate's earnings test, achieving a score of 8 out of a possible 30.

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