Safe and Sound

HERCULES

Salt Lake City, UT
3
Star Rating
HERCULES is a Salt Lake City, UT-based, NCUA-insured credit union started in 1973. As of December 31, 2017, the credit union held assets of $69.4 million.

Thanks to the efforts of 12 full-time employees, the credit union currently holds loans and leases worth $35.2 million. HERCULES's 5,415 members currently have $62.6 million in shares with the credit union.

Overall, Bankrate believes that, as of December 31, 2017, HERCULES exhibited a generally satisfactory condition, earning 3 out of 5 stars for safety and soundness. Keep reading for a breakdown of how the credit union did on the three key criteria Bankrate used to evaluate U.S. credit unions.

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THE INSTITUTION'S SCORE

Capital Score

When it comes to measuring a credit union's financial resilience, capital is useful. It acts as a cushion against losses and as protection for members when a credit union is experiencing economic instability. When it comes to safety and soundness, more capital is better.

On our test to measure capital adequacy, HERCULES received a score of 8 out of a possible 30 points, coming in below the national average of 15.65.

HERCULES appears to be on less solid financial footing than its peers in this area, with a capitalization ratio of 8.00 percent in our test, below the average for all credit unions.

Asset Quality Score

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

Having large numbers of these kinds of assets may eventually require a credit union to use capital to absorb losses, shrinking 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, resulting in diminished earnings and potentially more risk of a failure in the future.

On Bankrate's test of asset quality, HERCULES scored 36 out of a possible 40 points, below the national average of 38.09 points.

The credit union's ratio of troubled assets was 0.00 percent in our test, below the national average and suggestive of superior financial strength compared to other credit unions.

Earnings score

How successful a credit union is at earning money affects its long-term survivability. A credit union can retain its earnings, increasing its capital cushion, or use them to address problematic loans, potentially making the credit union better prepared to withstand financial shocks. Losses, on the other hand, take away from a credit union's ability to do those things.

HERCULES underperformed the average on Bankrate's test of earnings, achieving a score of 2 out of a possible 30.

The credit union had an earnings ratio of 0.00 percent in our test, higher than the average for all credit unions, a sign 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.