Safe and Sound

FINEX

East Hartford, CT
2
Star Rating
FINEX is an East Hartford, CT-based, NCUA-insured credit union started in 1938. Regulatory filings show the credit union having $81.6 million in assets, as of June 30, 2017.

Members have $58.4 million on deposit tended by 29 full-time employees. With that footprint, the credit union currently holds loans and leases worth $58.4 million. Its 9,208 members currently have $66.7 million in shares with the credit union.

Overall, Bankrate believes that, as of June 30, 2017, FINEX exhibited a below-average condition, earning 2 out of 5 stars for safety and soundness. Keep reading for a look at how the credit union did on the three major criteria Bankrate used to grade U.S. credit unions.

WHAT IS
SAFE AND SOUND?

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THE INSTITUTION'S SCORE

Capital Score

Capital acts as a buffer against losses and provides protection for members during periods of economic trouble for the credit union. It follows then that when it comes to measuring an a credit union's financial strength, capital is important. When looking at safety and soundness, more capital is preferred.

On our test to measure the adequacy of a credit union's capital, FINEX received a score of 8 out of a possible 30 points, lower than the national average of 15.26.

FINEX appears to be less well prepared for financial trouble than its peers in this area, with a capitalization ratio of 8.00 percent in our test, worse than the average for all credit unions.

Asset Quality Score

Bankrate uses this test to estimate the impact of troubled assets, such as past-due mortgages, on the credit union's loan loss reserves and overall capitalization.

Having a large number of these types of assets may eventually require a credit union to use capital to absorb losses, reducing its equity cushion. Many of those assets are also likely to be in non-accrual status and thus aren't earning interest for the credit union, resulting in reduced earnings and potentially more risk of a failure in the future.

On Bankrate's test of asset quality, FINEX scored 36 out of a possible 40 points, lower than the national average of 38.15 points.

The credit union's ratio of troubled assets was 12.00 percent in our test, greater than the national average and something to keep an eye on.

Earnings score

How successful a credit union is at earning money affects its safety and soundness. A credit union can retain its earnings, expanding its capital buffer, or use them to address problematic loans, potentially making the credit union better prepared to withstand economic shocks. Conversely, losses take away from a credit union's ability to do those things.

FINEX fell short of the national average on Bankrate's earnings test, achieving a score of 0 out of a possible 30.

One sign that FINEX is underperforming its peers in this area was its earnings ratio of -5.00 percent in our test, below the average for all credit unions.

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.