Safe and Sound

LINCOLN SUDBURY TOWN EMPLOYEE

Sudbury, MA
3
Star Rating
Founded in 1962, LINCOLN SUDBURY TOWN EMPLOYEE is an NCUA-insured credit union based in Sudbury, MA. As of December 31, 2017, the credit union had assets of $5.1 million.

The credit union has amassed loans and leases worth $1.7 million. Its 548 members currently have $4.4 million in shares with the credit union.

Overall, Bankrate believes that, as of December 31, 2017, LINCOLN SUDBURY TOWN EMPLOYEE exhibited a generally satisfactory condition, earning 3 out of 5 stars for safety and soundness. Here's a look at how the credit union did on the three important 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

Capital acts as a cushion against losses and provides protection for members when a credit union is struggling financially. It follows then that a credit union's level of capital is a crucial measurement of its financial resilience. When looking at safety and soundness, the more capital, the better.

On our test to measure the adequacy of a credit union's capital, LINCOLN SUDBURY TOWN EMPLOYEE racked up 16 out of a possible 30 points, beating the national average of 15.65.

LINCOLN SUDBURY TOWN EMPLOYEE's capitalization ratio of 16.00 percent in our test puts it right in line with 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 troubled assets, such as past-due loans.

Having extensive holdings of these types of assets suggests a credit union could eventually have to use capital to cover losses, decreasing its cushion of equity. Many of those assets are also likely to be in non-accrual status and no longer earning money, decreasing earnings and increasing the chances of a future failure.

LINCOLN SUDBURY TOWN EMPLOYEE fell short of the national average of 38.09 on Bankrate's asset quality test, racking up 24 out of a possible 40 points .

The credit union's ratio of problem assets was 0.00 percent in our test, beneath 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 long-term survivability. A credit union can retain its earnings, expanding its capital buffer, or use them to address problematic loans, potentially making the credit union more resilient in tough times. Conversely, losses reduce a credit union's ability to do those things.

LINCOLN SUDBURY TOWN EMPLOYEE scored 6 out of a possible 30 on Bankrate's test of earnings, falling short of the national average of 10.11.

LINCOLN SUDBURY TOWN EMPLOYEE had an earnings ratio of 0.00 percent in our test, better than the average for all credit unions, an indication that it's beating 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.