Safe and Sound

FAIRMONT VILLAGE

Fairmont City, IL
4
Star Rating
Started in 1937, FAIRMONT VILLAGE is an NCUA-insured credit union headquartered in Fairmont City, IL. The credit union holds $1.8 million in assets, according to December 31, 2017, regulatory filings.

With 2 full-time employees, the credit union has amassed loans and leases worth $936,537. Its 520 members currently have $1.4 million in shares with the credit union.

Overall, Bankrate believes that, as of December 31, 2017, FAIRMONT VILLAGE exhibited a good condition, earning 4 out of 5 stars for safety and soundness. Keep reading for an analysis of how the credit union did on the three major criteria Bankrate used to evaluate 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 as protection for members during periods of economic trouble for the credit union. Therefore, a credit union's level of capital is an essential measurement of its financial fortitude. When it comes to safety and soundness, the more capital, the better.

On our test to measure capital adequacy, FAIRMONT VILLAGE achieved a score of 28 out of a possible 30 points, beating the national average of 15.65.

FAIRMONT VILLAGE appears to be stronger than its peers, with a capitalization ratio of 28.00 percent in our test, higher than the average for all credit unions.

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 kinds of assets may eventually be required to use capital to absorb losses, decreasing its equity buffer. It also means that there are likely to be many assets that are in non-accrual status and no longer earning money, resulting in lower earnings and potentially more risk of a failure in the future.

FAIRMONT VILLAGE came in below the national average of 38.09 on Bankrate's asset quality test, racking up 36 out of a possible 40 points .

Troubled assets made up 0.00 percent of FAIRMONT VILLAGE's total assets in our test, less than the national average and 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 buffer, or be used to deal with problematic loans, likely making the credit union better able to withstand financial shocks. Conversely, losses lessen a credit union's ability to do those things.

FAIRMONT VILLAGE fell short of 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, above the average for all credit unions, suggesting that it's outperforming 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.