Safe and Sound

FREEDOM OF MARYLAND

Bel Air, MD
4
Star Rating
Bel Air, MD-based FREEDOM OF MARYLAND is an NCUA-insured credit union started in 1953. Regulatory filings show the credit union having assets of $315.7 million, as of December 31, 2017.

Members have $269.2 million on deposit tended by 77 full-time employees. With that footprint, the credit union currently holds loans and leases worth $269.2 million. Its 31,707 members currently have $275.6 million in shares with the credit union.

Overall, Bankrate believes that, as of December 31, 2017, FREEDOM OF MARYLAND exhibited a good condition, earning 4 out of 5 stars for safety and soundness. Keep reading for an analysis of how the credit union did on the three important criteria Bankrate used to grade U.S. credit unions.

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THE INSTITUTION'S SCORE

Capital Score

When it comes to measuring a credit union's financial strength, capital is useful. It works as a bulwark against losses and affords protection for members during periods of financial instability for the credit union. When it comes to safety and soundness, more capital is preferred.

FREEDOM OF MARYLAND received a score of 8 out of a possible 30 points on our test to measure the adequacy of a credit union's capital, less than the national average of 15.65.

FREEDOM OF MARYLAND had a capitalization ratio of 8.00 percent in our test, lower than the average for all credit unions, suggesting that it's on less solid financial footing than its peers.

Asset Quality Score

Bankrate uses this test to estimate the impact of problem assets, such as past-due loans, on the credit union's capitalization and allocated loan loss reserves.

A credit union with extensive holdings of these types of assets may eventually have to use capital to absorb losses, diminishing its equity buffer. Many of those assets are also likely to be in non-accrual status and thus aren't earning money, resulting in reduced earnings and potentially more risk of a failure in the future.

On Bankrate's test of asset quality, FREEDOM OF MARYLAND scored 36 out of a possible 40 points, failing to reach the national average of 38.09 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 ability to earn money affects its safety and soundness. A credit union can retain its earnings, boosting its capital buffer, or use them to deal with problematic loans, potentially making the credit union more resilient in tough times. However, credit unions that are losing money are less able to do those things.

FREEDOM OF MARYLAND received above-average marks on Bankrate's test of earnings, achieving a score of 14 out of a possible 30.

FREEDOM OF MARYLAND had an earnings ratio of 0.00 percent in our test, above 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.