Safe and Sound

ESSEX COUNTY TEACHERS

Bloomfield, NJ
1
Star Rating
ESSEX COUNTY TEACHERS is a Bloomfield, NJ-based, NCUA-insured credit union founded in 1936. The credit union holds $13.3 million in assets, according to December 31, 2017, regulatory filings.

Members have $7.6 million on deposit tended by 6 full-time employees. With that footprint, the credit union holds loans and leases worth $7.6 million. ESSEX COUNTY TEACHERS's 2,650 members currently have $12.2 million in shares with the credit union.

Overall, Bankrate believes that, as of December 31, 2017, ESSEX COUNTY TEACHERS 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 important criteria Bankrate used to grade American credit unions.

WHAT IS
SAFE AND SOUND?

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THE INSTITUTION'S SCORE

Capital Score

Capital works as a buffer against losses and provides protection for members when a credit union is struggling financially. It follows then that a credit union's level of capital is a key measurement of its financial strength. When it comes to safety and soundness, more capital is preferred.

ESSEX COUNTY TEACHERS received a score of 6 out of a possible 30 points on our test to measure capital adequacy, coming in below the national average of 15.65.

ESSEX COUNTY TEACHERS's capitalization ratio of 6.00 percent in our test was worse than the average for all credit unions, a sign that it's weaker than its peers.

Asset Quality Score

In this test, Bankrate tries to determine the effect of problem assets, such as past-due mortgages, on the credit union's loan loss reserves and overall capitalization.

Having extensive holdings of these kinds of assets suggests a credit union may eventually have to use capital to cover losses, cutting down on its cushion 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 diminished earnings and potentially more risk of a future failure.

On Bankrate's test of asset quality, ESSEX COUNTY TEACHERS scored 28 out of a possible 40 points, lower than 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 superior financial strength compared to other credit unions.

Earnings score

How successful a credit union is at earning money affects its long-term survivability. A credit union can retain its earnings, boosting its capital buffer, or put them to work addressing problematic loans, likely making the credit union better prepared to withstand economic shocks. Conversely, losses take away from a credit union's ability to do those things.

ESSEX COUNTY TEACHERS scored 0 out of a possible 30 on Bankrate's test of earnings, lower than the national average of 10.11.

ESSEX COUNTY TEACHERS had an earnings ratio of 0.00 percent in our test, better than 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.