Asset Quality Score
This test's purpose is to estimate how the credit union's reserves set aside to cover loan losses, as well as overall capitalization could be affected by problem assets, such as unpaid mortgages.
A credit union with lots of these kinds of assets could eventually be required to use capital to absorb losses, diminishing its cushion of equity. Many of those assets are also likely to be in non-accrual status and no longer earning money, diminishing earnings and elevating the risk of a failure in the future.
On Bankrate's test of asset quality, LM scored 40 out of a possible 40 points, beating the national average of 38.09 points.
The credit union's ratio of troubled assets was 0.00 percent in our test, below the national average and potentially indicative of superior financial strength compared to other credit unions.