Safe and Sound

LEECO

KEOKUK, IA
5
Star Rating
LEECO is a KEOKUK, IA-based, NCUA-insured credit union dating back to 1966. The credit union holds assets of $3.6 million, according to December 31, 2017, regulatory filings.

Members have $2.0 million on deposit tended by 2 full-time employees. With that footprint, the credit union has amassed loans and leases worth $2.0 million. LEECO's 685 members currently have $2.9 million in shares with the credit union.

Overall, Bankrate believes that, as of December 31, 2017, LEECO exhibited a superior condition, earning a full 5 stars for safety and soundness. Keep reading for an analysis of how the credit union faired on the three important criteria Bankrate used to grade U.S. credit unions on safety and soundness.

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THE INSTITUTION'S SCORE

Capital Score

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

LEECO did better than the national average of 15.65 points on our test to measure the adequacy of a credit union's capital, scoring 30 out of a possible 30 points.

LEECO's capitalization ratio of 30.00 percent in our test was higher than the average for all credit unions, suggesting that it's stronger than its peers.

Asset Quality Score

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

Having a large number of these types of assets suggests a credit union could have to use capital to absorb losses, reducing 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, resulting in depressed earnings and potentially more risk of a failure in the future.

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

LEECO's ratio of troubled assets was 0.00 percent in our test, less than the national average and suggestive of superior financial strength compared to other credit unions.

Earnings score

How successful a credit union is at earning money has an effect on its safety and soundness. Earnings may be retained by the credit union, giving a boost to its capital buffer, or be used to address problematic loans, likely making the credit union better able to withstand economic trouble. Obviously, credit unions that are losing money have less ability to do those things.

LEECO scored 8 out of a possible 30 on Bankrate's test of earnings, less than the national average of 10.11.

LEECO had an earnings ratio of 0.00 percent in our test, higher 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.