Safe and Sound

FIVEPOINT

NEDERLAND, TX
4
Star Rating
FIVEPOINT is a NEDERLAND, TX-based, NCUA-insured credit union dating back to 1935. Regulatory filings show the credit union having $646.4 million in assets, as of December 31, 2017.

With 175 full-time employees, the credit union currently holds loans and leases worth $435.9 million. Its 48,060 members currently have $569.3 million in shares with the credit union.

Overall, Bankrate believes that, as of December 31, 2017, FIVEPOINT exhibited a good condition, earning 4 out of 5 stars for safety and soundness. Here's a look at how the credit union did on the three major criteria Bankrate used to grade American credit unions.

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SAFE AND SOUND?

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THE INSTITUTION'S SCORE

Capital Score

When it comes to measuring a credit union's financial fortitude, capital is essential. It acts as a bulwark against losses and provides protection for members during times of economic trouble for the credit union. When looking at safety and soundness, the higher the capital, the better.

FIVEPOINT received a score of 12 out of a possible 30 points on our test to measure capital adequacy, below the national average of 15.65.

FIVEPOINT's capitalization ratio of 12.00 percent in our test was worse than the average for all credit unions, suggesting that it could have a harder time weathering financial trouble than its peers.

Asset Quality Score

This test's purpose is 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 large numbers of these types of assets may eventually have to use capital to absorb losses, shrinking its equity cushion. It also means that there are likely to be many assets that are in non-accrual status and thus aren't earning money, resulting in lower earnings and potentially more risk of a failure in the future.

FIVEPOINT exceeded 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 has an effect on its safety and soundness. A credit union can retain its earnings, expanding its capital buffer, or use them to deal with problematic loans, likely making the credit union more resilient in tough times. Conversely, losses diminish a credit union's ability to do those things.

FIVEPOINT fell short of the national average on Bankrate's earnings test, achieving a score of 6 out of a possible 30.

FIVEPOINT had an earnings ratio of 0.00 percent in our test, higher than the average for all credit unions, a sign 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.