Safe and Sound

FIREMAN'S

Birmingham, AL
5
Star Rating
FIREMAN'S is a Birmingham, AL-based, NCUA-insured credit union started in 1929. The credit union has $5.5 million in assets, according to December 31, 2017, regulatory filings.

The credit union currently holds loans and leases worth $3.3 million. FIREMAN'S's 888 members currently have $3.8 million in shares with the credit union.

Overall, Bankrate believes that, as of December 31, 2017, FIREMAN'S exhibited a superior condition, earning a full 5 stars for safety and soundness. Keep reading for an analysis of how the credit union faired on the three key criteria Bankrate used to score U.S. credit unions on safety and soundness.

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SAFE AND SOUND?

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THE INSTITUTION'S SCORE

Capital Score

Capital acts as a cushion against losses and affords protection for members when a credit union is struggling financially. Therefore, when it comes to measuring an a credit union's financial strength, capital is important. When looking at safety and soundness, more capital is better.

FIREMAN'S did better than the national average of 15.65 points on our test to measure capital adequacy, receiving a score of 30 out of a possible 30 points.

FIREMAN'S appears to be more well prepared for financial trouble than its peers, with a capitalization ratio of 30.00 percent in our test, higher than the average for all credit unions.

Asset Quality Score

This test's purpose is to estimate how the credit union's loan loss reserves and overall capitalization could be affected by troubled assets, such as past-due mortgages.

Having extensive holdings of these kinds of assets suggests a credit union may eventually have to use capital to cover losses, shrinking its equity buffer. It also means that there are likely to be many assets that are in non-accrual status and no longer earning interest for the credit union, resulting in reduced earnings and potentially more risk of a failure in the future.

FIREMAN'S did better than the national average of 38.09 on Bankrate's test of asset quality, racking up 40 out of a possible 40 points .

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 affects its safety and soundness. Earnings can be retained by the credit union, giving a boost to its capital cushion, or be used to deal with problematic loans, potentially making the credit union more resilient in times of trouble. Losses, on the other hand, lessen a credit union's ability to do those things.

On Bankrate's earnings test, FIREMAN'S scored 20 out of a possible 30, above the national average of 10.11.

One sign that FIREMAN'S is outperforming its peers in this area was its earnings ratio of 0.00 percent in our test, above 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.