Safe and Sound

FOOTHILLS

LOUDON, TN
4
Star Rating
Founded in 1962, FOOTHILLS is an NCUA-insured credit union headquartered in LOUDON, TN. As of December 31, 2017, the credit union had assets of $47.2 million.

With 17 full-time employees, the credit union currently holds loans and leases worth $24.3 million. Its 4,813 members currently have $41.8 million in shares with the credit union.

Overall, Bankrate believes that, as of December 31, 2017, FOOTHILLS exhibited a good condition, earning 4 out of 5 stars for safety and soundness. Keep reading for a breakdown of how the credit union did on the three key criteria Bankrate used to grade American credit unions.

WHAT IS
SAFE AND SOUND?

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THE INSTITUTION'S SCORE

Capital Score

Capital is a key measurement of a credit union's financial resilience. It acts as a cushion against losses and affords protection for members when a credit union is struggling financially. When it comes to safety and soundness, more capital is better.

On our test to measure the adequacy of a credit union's capital, FOOTHILLS received a score of 14 out of a possible 30 points, failing to reach the national average of 15.65.

FOOTHILLS appears to be weaker than its peers in this area, with a capitalization ratio of 14.00 percent in our test, below the average for all credit unions.

Asset Quality Score

Bankrate uses this test to determine the effect of troubled assets, such as past-due mortgages, on the credit union's loan loss reserves and overall capitalization.

Having a large number of these types of assets means a credit union could have to use capital to absorb losses, diminishing its cushion of equity. Many of those assets are also likely to be in non-accrual status and thus aren't earning interest for the credit union, resulting in lower earnings and potentially more risk of a failure in the future.

FOOTHILLS scored 40 out of a possible 40 points on Bankrate's test of asset quality, beating the national average of 38.09.

A below-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 profitability 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, potentially making the credit union better able to withstand economic shocks. Conversely, losses take away from a credit union's ability to do those things.

On Bankrate's earnings test, FOOTHILLS scored 6 out of a possible 30, lower than the national average of 10.11.

One sign that the credit union is running ahead of its peers in this area was its earnings ratio of 0.00 percent in our test, better than the average for all credit unions.

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.