Safe and Sound

FO ME BO CO

Wabash, IN
4
Star Rating
Wabash, IN-based FO ME BO CO is an NCUA-insured credit union started in 1969. As of December 31, 2017, the credit union held assets of $3.5 million.

With 2 full-time employees, the credit union has amassed loans and leases worth $1.8 million. Its 708 members currently have $2.9 million in shares with the credit union.

Overall, Bankrate believes that, as of December 31, 2017, FO ME BO CO exhibited a good condition, earning 4 out of 5 stars for safety and soundness. Here's an analysis of how the credit union did on the three important criteria Bankrate used to score American credit unions.

WHAT IS
SAFE AND SOUND?

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THE INSTITUTION'S SCORE

Capital Score

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

On our test to measure capital adequacy, FO ME BO CO racked up 20 out of a possible 30 points, exceeding the national average of 15.65.

FO ME BO CO's capitalization ratio of 20.00 percent in our test was higher than the average for all credit unions, a sign that it's on more solid financial footing than its peers.

Asset Quality Score

This test's purpose is to try to understand how the credit union's reserves set aside to cover loan losses, as well as overall capitalization could be affected by problem assets, such as unpaid mortgages.

Having large numbers of these types of assets could eventually require a credit union to use capital to cover losses, cutting down on its equity cushion. Many of those assets are also likely to be in non-accrual status and no longer earning money, resulting in depressed earnings and potentially more risk of a failure in the future.

FO ME BO CO scored 40 out of a possible 40 points on Bankrate's asset quality test, better than the national average of 38.09.

Earnings score

A credit union's profitability has an effect on its safety and soundness. A credit union can retain its earnings, boosting its capital buffer, or put them to work addressing problematic loans, likely making the credit union more resilient in tough times. Losses, on the other hand, take away from a credit union's ability to do those things.

FO ME BO CO scored 2 out of a possible 30 on Bankrate's earnings test, falling short of the national average of 10.11.

The credit union had an earnings ratio of 0.00 percent in our test, higher than the average for all credit unions, an indication that it's beating 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.