Safe and Sound

KEMBA DELTA

MEMPHIS, TN
5
Star Rating
Bartlett, TN-based KEMBA DELTA is an NCUA-insured credit union started in 1934. The credit union has assets of $22.8 million, according to December 31, 2017, regulatory filings.

Thanks to the work of 7 full-time employees, the credit union holds loans and leases worth $13.1 million. KEMBA DELTA's 5,015 members currently have $16.6 million in shares with the credit union.

Overall, Bankrate believes that, as of December 31, 2017, KEMBA DELTA exhibited a superior condition, earning a full 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 U.S. credit unions on safety and soundness.

WHAT IS
SAFE AND SOUND?

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THE INSTITUTION'S SCORE

Capital Score

When it comes to measuring an institution's financial resilience, capital is important. It acts as a cushion against losses and affords protection for members when a credit union is experiencing economic trouble. From a safety and soundness perspective, the higher the capital, the better.

KEMBA DELTA beat out the national average of 15.65 points on our test to measure capital adequacy, receiving a score of 30 out of a possible 30 points.

KEMBA DELTA's capitalization ratio of 30.00 percent in our test was above the average for all credit unions, suggesting that it could have an easier time weathering financial trouble than its peers.

Asset Quality Score

Bankrate uses this test to determine the impact of troubled assets, such as unpaid mortgages, on the credit union's capitalization and allocated loan loss reserves.

Having lots of these kinds of assets could eventually force a credit union to use capital to absorb losses, decreasing its equity buffer. Many of those assets are also likely to be in non-accrual status and no longer earning money, resulting in reduced earnings and potentially more risk of a future failure.

KEMBA DELTA beat out the national average of 38.09 on Bankrate's test of asset quality, racking up 40 out of a possible 40 points .

KEMBA DELTA's ratio of troubled assets was 0.00 percent in our test, below 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 safety and soundness. A credit union can retain its earnings, boosting its capital buffer, or use them to address problematic loans, likely making the credit union more resilient in tough times. Obviously, credit unions that are losing money have less ability to do those things.

KEMBA DELTA fell short of the national average on Bankrate's earnings test, achieving a score of 4 out of a possible 30.

KEMBA DELTA had an earnings ratio of 0.00 percent in our test, higher than the average for all credit unions, suggesting that it's outperforming 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.