Safe and Sound

HARRISON DISTRICT NO 2

COLORADO SPRING, CO
3
Star Rating
HARRISON DISTRICT NO 2 is a COLORADO SPRING, CO-based, NCUA-insured credit union dating back to 1957. As of December 31, 2017, the credit union had assets of $14.6 million.

Thanks to the work of 4 full-time employees, the credit union holds loans and leases worth $6.5 million. Its 1,552 members currently have $12.8 million in shares with the credit union.

Overall, Bankrate believes that, as of December 31, 2017, HARRISON DISTRICT NO 2 exhibited a generally satisfactory condition, earning 3 out of 5 stars for safety and soundness. Here's a look at how the credit union did on the three important criteria Bankrate used to evaluate U.S. credit unions.

WHAT IS
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THE INSTITUTION'S SCORE

Capital Score

Capital works as a bulwark against losses and provides protection for members during times of economic instability for the credit union. It follows then that a credit union's level of capital is a crucial measurement of its financial strength. From a safety and soundness perspective, the more capital, the better.

HARRISON DISTRICT NO 2 finished below the national average of 15.65 on our test to measure capital adequacy, achieving a score of 14 out of a possible 30 points.

HARRISON DISTRICT NO 2 had a capitalization ratio of 14.00 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

In this test, Bankrate tries to determine the effect 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.

A credit union with a large number of these kinds of assets could eventually be forced to use capital to absorb losses, cutting down on 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, resulting in reduced earnings and potentially more risk of a failure in the future.

On Bankrate's test of asset quality, HARRISON DISTRICT NO 2 scored 36 out of a possible 40 points, coming in below the national average of 38.09 points.

The credit union's ratio of problem assets was 0.00 percent in our test, lower than the national average and potentially indicative of superior financial strength compared to other credit unions.

Earnings score

A credit union's ability to earn money affects 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 more resilient in tough times. Credit unions that are losing money, however, are less able to do those things.

On Bankrate's earnings test, HARRISON DISTRICT NO 2 scored 0 out of a possible 30, coming in below the national average of 10.11.

One sign that HARRISON DISTRICT NO 2 is outperforming its peers in this area was its earnings ratio of 0.00 percent in our test, above 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.