Safe and Sound

HAPO COMMUNITY

RICHLAND, WA
4
Star Rating
Founded in 1953, HAPO COMMUNITY is an NCUA-insured credit union headquartered in RICHLAND, WA. As of December 31, 2017, the credit union held assets of $1.59 billion.

Thanks to the work of 364 full-time employees, the credit union has amassed loans and leases worth $1.41 billion. HAPO COMMUNITY's 154,129 members currently have $1.37 billion in shares with the credit union.

Overall, Bankrate believes that, as of December 31, 2017, HAPO COMMUNITY 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 major criteria Bankrate used to evaluate U.S. credit unions.

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THE INSTITUTION'S SCORE

Capital Score

Capital works as a buffer against losses and affords protection for members when a credit union is struggling financially. It follows then that a credit union's level of capital is a useful measurement of its financial resilience. When looking at safety and soundness, the more capital, the better.

On our test to measure the adequacy of a credit union's capital, HAPO COMMUNITY received a score of 6 out of a possible 30 points, failing to reach the national average of 15.65.

HAPO COMMUNITY had a capitalization ratio of 6.00 percent in our test, lower than the average for all credit unions, a sign that it could be less resilient in a crisis than its peers.

Asset Quality Score

In this test, Bankrate tries to determine the impact of problem assets, such as past-due mortgages, on the credit union's reserves set aside to cover loan losses, as well as overall capitalization.

Having extensive holdings of these types of assets means a credit union could eventually have to use capital to absorb losses, decreasing its buffer of equity. Many of those assets are also likely to be in non-accrual status and thus aren't earning money, decreasing earnings and elevating the chances of a failure in the future.

HAPO COMMUNITY scored 40 out of a possible 40 points on Bankrate's test of asset quality, better than the national average of 38.09.

A below-average ratio of problem assets of 0.00 percent in our test was potentially indicative of superior financial strength compared to 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, giving a boost to its capital buffer, or use them to address problematic loans, likely making the credit union better able to withstand financial trouble. Credit unions that are losing money, however, have less ability to do those things.

HAPO COMMUNITY scored 16 out of a possible 30 on Bankrate's test of earnings, better than the national average of 10.11.

HAPO COMMUNITY had an earnings ratio of 0.00 percent in our test, above the average for all credit unions, suggesting 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.