Asset Quality Score
Bankrate uses this test to estimate the impact of problem assets, such as past-due 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 kinds of assets could eventually be forced to use capital to absorb losses, shrinking its buffer of equity. It also means that there are likely to be many assets that are in non-accrual status and no longer earning money, pushing down earnings and elevating the risk of a failure in the future.
LAKE COMMUNITY scored 40 out of a possible 40 points on Bankrate's test of asset quality, exceeding the national average of 38.09.
A lower-than-average ratio of problem assets of 0.00 percent in our test was potentially indicative of greater financial strength than other credit unions.