Safe and Sound

FINANCIAL TRUST

CHEEKTOWAGA, NY
4
Star Rating
Orchard Park, NY-based FINANCIAL TRUST is an NCUA-insured credit union founded in 1950. The credit union holds $76.2 million in assets, according to December 31, 2017, regulatory filings.

Thanks to the work of 17 full-time employees, the credit union has amassed loans and leases worth $49.9 million. FINANCIAL TRUST's 8,785 members currently have $66.5 million in shares with the credit union.

Overall, Bankrate believes that, as of December 31, 2017, FINANCIAL TRUST 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 evaluate American credit unions.

WHAT IS
SAFE AND SOUND?

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THE INSTITUTION'S SCORE

Capital Score

Capital is a valuable measurement of an institution's financial strength. It acts as a buffer against losses and provides protection for members during times of economic instability for the credit union. From a safety and soundness perspective, the higher the capital, the better.

FINANCIAL TRUST racked up 16 out of a possible 30 points on our test to measure the adequacy of a credit union's capital, beating out the national average of 15.65.

FINANCIAL TRUST's capitalization ratio of 16.00 percent in our test puts it right in line with the average for all credit unions.

Asset Quality Score

In this test, Bankrate tries to estimate the effect of troubled assets, such as unpaid loans, on the credit union's loan loss reserves and overall capitalization.

A credit union with extensive holdings of these types of assets may eventually be required to use capital to absorb losses, shrinking its equity cushion. 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.

FINANCIAL TRUST exceeded the national average of 38.09 on Bankrate's asset quality test, racking up 40 out of a possible 40 points .

Troubled assets made up 0.00 percent of FINANCIAL TRUST's total assets in our test, below 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 affects its long-term survivability. A credit union can retain its earnings, expanding its capital buffer, or use them to address problematic loans, likely making the credit union more resilient in tough times. However, credit unions that are losing money are less able to do those things.

FINANCIAL TRUST scored 12 out of a possible 30 on Bankrate's test of earnings, above the national average of 10.11.

The credit union had an earnings ratio of 0.00 percent in our test, higher than 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.