Safe and Sound

I.L.A. LOCAL 1235

Newark, NJ
4
Star Rating
Founded in 1981, I.L.A. LOCAL 1235 is an NCUA-insured credit union headquartered in Newark, NJ. As of December 31, 2017, the credit union held assets of $7.4 million.

With 2 full-time employees, the credit union has amassed loans and leases worth $4.1 million. Its 622 members currently have $6.1 million in shares with the credit union.

Overall, Bankrate believes that, as of December 31, 2017, I.L.A. LOCAL 1235 exhibited a good condition, earning 4 out of 5 stars for safety and soundness. Here's a breakdown of how the credit union faired on the three key criteria Bankrate used to grade American credit unions.

WHAT IS
SAFE AND SOUND?

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THE INSTITUTION'S SCORE

Capital Score

Capital works as a cushion against losses and provides protection for members when a credit union is struggling financially. Therefore, an institution's level of capital is an important measurement of its financial strength. When it comes to safety and soundness, the more capital, the better.

I.L.A. LOCAL 1235 achieved a score of 26 out of a possible 30 points on our test to measure the adequacy of a credit union's capital, above the national average of 15.65.

I.L.A. LOCAL 1235's capitalization ratio of 26.00 percent in our test was higher than the average for all credit unions, an indication that it could have an easier time weathering financial trouble 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 unpaid mortgages.

Having a large number of these types of assets suggests a credit union could eventually have to use capital to absorb losses, diminishing its cushion of equity. It also means that there are likely to be many assets that are in non-accrual status and thus aren't earning interest for the credit union, pushing down earnings and elevating the chances of a failure in the future.

I.L.A. LOCAL 1235 exceeded the national average of 38.09 on Bankrate's asset quality test, racking up 40 out of a possible 40 points .

Earnings score

How successful a credit union is at making money has an effect on its safety and soundness. Earnings can be retained by the credit union, boosting its capital buffer, or be used to address problematic loans, potentially making the credit union more resilient in tough times. Credit unions that are losing money, however, have less ability to do those things.

I.L.A. LOCAL 1235 fell short of the national average on Bankrate's test of earnings, achieving a score of 0 out of a possible 30.

I.L.A. LOCAL 1235 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.