Safe and Sound

FIRST SOUTH FINANCIAL

BARTLETT, TN
5
Star Rating
Founded in 1957, FIRST SOUTH FINANCIAL is an NCUA-insured credit union based in BARTLETT, TN. As of December 31, 2017, the credit union had assets of $550.6 million.

With 116 full-time employees, the credit union has amassed loans and leases worth $346.1 million. FIRST SOUTH FINANCIAL's 61,802 members currently have $380.5 million in shares with the credit union.

Overall, Bankrate believes that, as of December 31, 2017, FIRST SOUTH FINANCIAL exhibited a superior condition, earning a full 5 stars for safety and soundness. Keep reading for a breakdown of how the credit union did on the three important criteria Bankrate used to grade American credit unions on safety and soundness.

WHAT IS
SAFE AND SOUND?

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THE INSTITUTION'S SCORE

Capital Score

When it comes to measuring an institution's financial resilience, capital is important. It acts as a bulwark against losses and affords protection for members when a credit union is experiencing economic trouble. From a safety and soundness perspective, the more capital, the better.

FIRST SOUTH FINANCIAL exceeded the national average of 15.65 points on our test to measure capital adequacy, racking up 30 out of a possible 30 points.

FIRST SOUTH FINANCIAL's capitalization ratio of 30.00 percent in our test was above the average for all credit unions, suggesting that it's more well prepared for financial trouble than its peers.

Asset Quality Score

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

A credit union with a large number of these types of assets may eventually have to use capital to absorb losses, decreasing 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, reducing earnings and increasing the risk of a failure in the future.

FIRST SOUTH FINANCIAL beat out the national average of 38.09 on Bankrate's asset quality test, 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 superior financial strength compared to 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, boosting its capital cushion, or put them to work addressing problematic loans, potentially making the credit union more resilient in times of trouble. Obviously, credit unions that are losing money are less able to do those things.

FIRST SOUTH FINANCIAL exceeded the national average on Bankrate's test of earnings, achieving a score of 14 out of a possible 30.

FIRST SOUTH FINANCIAL 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.