Safe and Sound

HAWAII FIRST

Kamuela, HI
5
Star Rating
HAWAII FIRST is a Kamuela, HI-based, NCUA-insured credit union that opened its doors in 1956. Regulatory filings show the credit union having $39.0 million in assets, as of December 31, 2017.

Thanks to the work of 23 full-time employees, the credit union holds loans and leases worth $26.8 million. HAWAII FIRST's 8,054 members currently have $28.1 million in shares with the credit union.

Overall, Bankrate believes that, as of December 31, 2017, HAWAII FIRST exhibited a superior condition, earning a full 5 stars for safety and soundness. Here's a look at how the credit union faired on the three major criteria Bankrate used to grade U.S. credit unions on safety and soundness.

WHAT IS
SAFE AND SOUND?

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THE INSTITUTION'S SCORE

Capital Score

Capital acts as a bulwark against losses and provides protection for members during periods of financial trouble for the credit union. Therefore, a credit union's level of capital is an essential measurement of its financial resilience. From a safety and soundness perspective, more capital is better.

HAWAII FIRST fell below the national average of 15.65 on our test to measure the adequacy of a credit union's capital, achieving a score of 14 out of a possible 30 points.

HAWAII FIRST had a capitalization ratio of 14.00 percent in our test, less than the average for all credit unions, suggesting that it's weaker than its peers.

Asset Quality Score

This test is intended to estimate how the credit union's loan loss reserves and overall capitalization could be affected by problem assets, such as past-due mortgages.

A credit union with lots of these kinds of assets could eventually be forced 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 money, reducing earnings and increasing the chances of a failure in the future.

HAWAII FIRST fell short of the national average of 38.09 on Bankrate's test of asset quality, racking up 36 out of a possible 40 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

How successful a credit union is at earning money has an effect on its safety and soundness. Earnings may be retained by the credit union, giving a boost to its capital buffer, or be used to deal with problematic loans, likely making the credit union better able to withstand financial trouble. Losses, on the other hand, reduce a credit union's ability to do those things.

HAWAII FIRST scored 26 out of a possible 30 on Bankrate's earnings test, better than the national average of 10.11.

The credit union had an earnings ratio of 0.00 percent in our test, higher than the average for all credit unions, suggesting that it's running ahead of 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.