Safe and Sound

FIRST FINANCIAL

Freehold, NJ
1
Star Rating
Founded in 1936, FIRST FINANCIAL is an NCUA-insured credit union based in Freehold, NJ. The credit union holds $190.0 million in assets, according to December 31, 2017, regulatory filings.

Members have $139.6 million on deposit tended by 51 full-time employees. With that footprint, the credit union currently holds loans and leases worth $139.6 million. Its 19,749 members currently have $174.2 million in shares with the credit union.

Overall, Bankrate believes that, as of December 31, 2017, FIRST FINANCIAL exhibited a significantly below-average condition, earning 1 out of 5 stars for safety and soundness. Keep reading for a look at how the credit union did on the three key 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 is an essential measurement of an institution's financial fortitude. It acts as a cushion against losses and affords protection for members during times of financial trouble for the credit union. From a safety and soundness perspective, the more capital, the better.

FIRST FINANCIAL finished below the national average of 15.65 on our test to measure the adequacy of a credit union's capital, receiving a score of 2 out of a possible 30 points.

FIRST FINANCIAL's capitalization ratio of 2.00 percent in our test was lower than the average for all credit unions, suggesting that it's less well prepared for financial trouble than its peers.

Asset Quality Score

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

Having lots of these kinds of assets suggests a credit union may have to use capital to cover losses, decreasing its equity buffer. It also means that there are likely to be many assets that are in non-accrual status and thus aren't earning money, pushing down earnings and increasing the chances of a failure in the future.

FIRST FINANCIAL scored 12 out of a possible 40 points on Bankrate's asset quality test, failing to reach the national average of 38.09.

The credit union's ratio of problem assets was 1.00 percent in our test, the same as the national average.

Earnings score

How successful a credit union is at earning money has an effect on its long-term survivability. Earnings may be retained by the credit union, giving a boost to its capital cushion, or be used to address problematic loans, likely making the credit union more resilient in tough times. Conversely, losses take away from a credit union's ability to do those things.

FIRST FINANCIAL scored 0 out of a possible 30 on Bankrate's test of earnings, falling short of the national average of 10.11.

FIRST FINANCIAL had an earnings ratio of 0.00 percent in our test, higher than the average for all credit unions, an indication 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.