Safe and Sound

KUE

Lexington, KY
5
Star Rating
Lexington, KY-based KUE is an NCUA-insured credit union started in 1976. As of December 31, 2017, the credit union held assets of $43.1 million.

With 5 full-time employees, the credit union currently holds loans and leases worth $15.1 million. KUE's 3,514 members currently have $37.1 million in shares with the credit union.

Overall, Bankrate believes that, as of December 31, 2017, KUE exhibited a superior condition, earning a full 5 stars for safety and soundness. Here's a look at how the credit union faired on the three key criteria Bankrate used to evaluate American credit unions on safety and soundness.

WHAT IS
SAFE AND SOUND?

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THE INSTITUTION'S SCORE

Capital Score

Capital acts as a buffer against losses and provides protection for members when a credit union is struggling financially. Therefore, when it comes to measuring an an institution's financial resilience, capital is valuable. When it comes to safety and soundness, the more capital, the better.

On our test to measure capital adequacy, KUE scored 18 out of a possible 30 points, beating out the national average of 15.65.

KUE appears to be stronger than its peers, with a capitalization ratio of 18.00 percent in our test, above the average for all credit unions.

Asset Quality Score

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

A credit union with extensive holdings of these types of assets could eventually have to use capital to cover losses, reducing its equity cushion. 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, resulting in depressed earnings and potentially more risk of a future failure.

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

A lower-than-average ratio of troubled assets of 0.00 percent in our test was potentially indicative of superior financial strength compared to other credit unions.

Earnings score

A credit union's ability to earn money affects its safety and soundness. Earnings can be retained by the credit union, expanding its capital cushion, or be used to address problematic loans, potentially making the credit union better able to withstand financial shocks. However, credit unions that are losing money have less ability to do those things.

On Bankrate's test of earnings, KUE scored 12 out of a possible 30, exceeding the national average of 10.11.

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