Safe and Sound

FREEDOM FIRST

DAYTON, OH
3
Star Rating
FREEDOM FIRST is a DAYTON, OH-based, NCUA-insured credit union that opened its doors in 1961. The credit union holds assets of $34.7 million, according to December 31, 2017, regulatory filings.

With 13 full-time employees, the credit union holds loans and leases worth $21.5 million. FREEDOM FIRST's 6,319 members currently have $31.0 million in shares with the credit union.

Overall, Bankrate believes that, as of December 31, 2017, FREEDOM FIRST exhibited a generally satisfactory condition, earning 3 out of 5 stars for safety and soundness. Here's an analysis of how the credit union did on the three key criteria Bankrate used to evaluate American credit unions.

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THE INSTITUTION'S SCORE

Capital Score

When it comes to measuring an institution's financial strength, capital is useful. It works as a bulwark against losses and provides protection for members when a credit union is struggling financially. When looking at safety and soundness, more capital is preferred.

On our test to measure the adequacy of a credit union's capital, FREEDOM FIRST received a score of 10 out of a possible 30 points, below the national average of 15.65.

FREEDOM FIRST appears to be less well prepared for financial trouble than its peers in this area, with a capitalization ratio of 10.00 percent in our test, below the average for all credit unions.

Asset Quality Score

Bankrate uses this test to determine the impact of troubled assets, such as unpaid loans, on the credit union's capitalization and allocated loan loss reserves.

A credit union with large numbers of these kinds of assets may eventually have to use capital to absorb losses, decreasing 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 interest for the credit union, pushing down earnings and increasing the chances of a future failure.

FREEDOM FIRST scored 36 out of a possible 40 points on Bankrate's test of asset quality, lower than the national average of 38.09.

A below-average ratio of troubled 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 long-term survivability. A credit union can retain its earnings, increasing its capital cushion, or use them to deal with problematic loans, potentially making the credit union more resilient in tough times. Conversely, losses lessen a credit union's ability to do those things.

FREEDOM FIRST fell short of the national average on Bankrate's test of earnings, achieving a score of 4 out of a possible 30.

The credit union 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.