Safe and Sound

FIVE STAR OF MARYLAND

Baltimore, MD
3
Star Rating
FIVE STAR OF MARYLAND is a BALTIMORE, MD-based, NCUA-insured credit union started in 1969. Regulatory filings show the credit union having $51.4 million in assets, as of December 31, 2017.

Members have $27.3 million on deposit tended by 13 full-time employees. With that footprint, the credit union has amassed loans and leases worth $27.3 million. FIVE STAR OF MARYLAND's 6,977 members currently have $45.1 million in shares with the credit union.

Overall, Bankrate believes that, as of December 31, 2017, FIVE STAR OF MARYLAND exhibited a generally satisfactory condition, earning 3 out of 5 stars for safety and soundness. Keep reading for a breakdown of how the credit union faired on the three key criteria Bankrate used to grade U.S. credit unions.

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THE INSTITUTION'S SCORE

Capital Score

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

On our test to measure capital adequacy, FIVE STAR OF MARYLAND received a score of 10 out of a possible 30 points, failing to reach the national average of 15.65.

FIVE STAR OF MARYLAND's capitalization ratio of 10.00 percent in our test was less than the average for all credit unions, an indication that it's on less solid financial footing than its peers.

Asset Quality Score

This test is intended 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 lots of these kinds of assets suggests a credit union may have to use capital to absorb losses, shrinking its buffer of equity. 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 elevating the chances of a future failure.

On Bankrate's test of asset quality, FIVE STAR OF MARYLAND scored 40 out of a possible 40 points, beating out the national average of 38.09 points.

The credit union's ratio of troubled assets was 0.00 percent 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 earning money has an effect on its safety and soundness. Earnings can be retained by the credit union, increasing its capital buffer, or be used to deal with problematic loans, potentially making the credit union more resilient in times of trouble. Losses, on the other hand, take away from a credit union's ability to do those things.

FIVE STAR OF MARYLAND fell behind the national average on Bankrate's test of earnings, achieving a score of 2 out of a possible 30.

FIVE STAR OF MARYLAND had an earnings ratio of 0.00 percent in our test, higher than the average for all credit unions, a sign that it's doing better than 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.