Safe and Sound

HOMETOWN

PERU, IN
5
Star Rating
HOMETOWN is an NCUA-insured credit union founded in 1936 and currently headquartered in PERU, IN. As of December 31, 2017, the credit union held assets of $24.1 million.

With 8 full-time employees, the credit union holds loans and leases worth $18.8 million. HOMETOWN's 3,636 members currently have $19.8 million in shares with the credit union.

Overall, Bankrate believes that, as of December 31, 2017, HOMETOWN exhibited a superior condition, earning a full 5 stars for safety and soundness. Keep reading for an analysis of how the credit union faired on the three important criteria Bankrate used to score U.S. credit unions on safety and soundness.

WHAT IS
SAFE AND SOUND?

Find out

THE INSTITUTION'S SCORE

Capital Score

Capital is a key measurement of an institution's financial resilience. It acts as a cushion against losses and affords protection for members during periods of financial instability for the credit union. When it comes to safety and soundness, more capital is better.

HOMETOWN scored 26 out of a possible 30 points on our test to measure the adequacy of a credit union's capital, beating the national average of 15.65.

HOMETOWN had a capitalization ratio of 26.00 percent in our test, higher than the average for all credit unions, suggesting that it could be more resilient in a crisis than its peers.

Asset Quality Score

In this test, Bankrate tries to estimate the effect of problem assets, such as unpaid loans, on the credit union's loan loss reserves and overall capitalization.

A credit union with a large number of these kinds of assets may eventually have 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, decreasing earnings and increasing the risk of a failure in the future.

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

A below-average ratio of troubled assets of 0.00 percent in our test was potentially indicative of greater financial strength than other credit unions.

Earnings score

A credit union's earnings performance has an effect on its long-term survivability. A credit union can retain its earnings, giving a boost to its capital cushion, or put them to work addressing problematic loans, potentially making the credit union better prepared to withstand financial trouble. Conversely, losses diminish a credit union's ability to do those things.

HOMETOWN beat the national average on Bankrate's test of earnings, achieving a score of 26 out of a possible 30.

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