Safe and Sound

IAM COMMUNITY

ENTERPRISE, AL
2
Star Rating
IAM COMMUNITY is an NCUA-insured credit union founded in 1964 and currently headquartered in ENTERPRISE, AL. Regulatory filings show the credit union having assets of $32.1 million, as of December 31, 2017.

With 13 full-time employees, the credit union holds loans and leases worth $18.4 million. Its 4,439 members currently have $29.3 million in shares with the credit union.

Overall, Bankrate believes that, as of December 31, 2017, IAM COMMUNITY exhibited a below-average condition, earning 2 out of 5 stars for safety and soundness. Keep reading for an analysis of how the credit union did on the three major criteria Bankrate used to grade U.S. credit unions.

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SAFE AND SOUND?

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THE INSTITUTION'S SCORE

Capital Score

When it comes to measuring a credit union's financial fortitude, capital is essential. It acts as a cushion against losses and as protection for members when a credit union is experiencing financial instability. From a safety and soundness perspective, the higher the capital, the better.

IAM COMMUNITY came in below the national average of 15.65 on our test to measure the adequacy of a credit union's capital, receiving a score of 8 out of a possible 30 points.

IAM COMMUNITY had a capitalization ratio of 8.00 percent in our test, worse than the average for all credit unions, suggesting that it's less well prepared for financial trouble than its peers.

Asset Quality Score

Bankrate uses this test to estimate the effect of problem assets, such as unpaid loans, on the credit union's reserves set aside to cover loan losses, as well as overall capitalization.

A credit union with a large number of these types of assets may eventually have to use capital to cover losses, diminishing 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 chances of a future failure.

IAM COMMUNITY scored below the national average of 38.09 on Bankrate's asset quality test, racking up 36 out of a possible 40 points .

IAM COMMUNITY's ratio of problem assets was 0.00 percent in our test, lower than the national average and potentially indicative of greater financial strength than other credit unions.

Earnings score

A credit union's ability to earn money affects its long-term survivability. A credit union can retain its earnings, expanding its capital buffer, or put them to work addressing problematic loans, potentially making the credit union more resilient in times of trouble. Conversely, losses lessen a credit union's ability to do those things.

IAM COMMUNITY scored 0 out of a possible 30 on Bankrate's test of earnings, less than the national average of 10.11.

IAM COMMUNITY had an earnings ratio of 0.00 percent in our test, better 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.