Safe and Sound

HEMINGFORD COMMUNITY

HEMINGFORD, NE
4
Star Rating
HEMINGFORD, NE-based HEMINGFORD COMMUNITY is an NCUA-insured credit union started in 1951. As of December 31, 2017, the credit union held assets of $7.2 million.

Members have $3.3 million on deposit tended by 2 full-time employees. With that footprint, the credit union has amassed loans and leases worth $3.3 million. HEMINGFORD COMMUNITY's 1,027 members currently have $6.6 million in shares with the credit union.

Overall, Bankrate believes that, as of December 31, 2017, HEMINGFORD COMMUNITY exhibited a good condition, earning 4 out of 5 stars for safety and soundness. Here's an analysis of how the credit union did on the three major criteria Bankrate used to evaluate American 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 experiencing economic trouble. It follows then that an institution's level of capital is a useful measurement of its financial resilience. When looking at safety and soundness, more capital is preferred.

HEMINGFORD COMMUNITY finished below the national average of 15.65 on our test to measure capital adequacy, achieving a score of 10 out of a possible 30 points.

HEMINGFORD COMMUNITY appears to be weaker than its peers in this area, with a capitalization ratio of 10.00 percent in our test, less than the average for all credit unions.

Asset Quality Score

This test's purpose is to try to understand how the credit union's capitalization and allocated loan loss reserves could be affected by troubled assets, such as past-due mortgages.

Having lots of these types of assets may eventually force a credit union to use capital to cover losses, decreasing its equity cushion. 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 failure in the future.

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

A below-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 making money affects its safety and soundness. Earnings may be retained by the credit union, giving a boost to its capital cushion, or be used to address problematic loans, likely making the credit union more resilient in times of trouble. Credit unions that are losing money, however, have less ability to do those things.

HEMINGFORD COMMUNITY did below-average on Bankrate's test of earnings, achieving a score of 6 out of a possible 30.

HEMINGFORD COMMUNITY had an earnings ratio of 0.00 percent in our test, higher than the average for all credit unions, an indication 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.