Safe and Sound

LONE STAR

DALLAS, TX
2
Star Rating
Started in 1967, LONE STAR is an NCUA-insured credit union headquartered in DALLAS, TX. Regulatory filings show the credit union having $121.0 million in assets, as of December 31, 2017.

With 43 full-time employees, the credit union has amassed loans and leases worth $100.8 million. LONE STAR's 11,288 members currently have $109.8 million in shares with the credit union.

Overall, Bankrate believes that, as of December 31, 2017, LONE STAR exhibited a below-average condition, earning 2 out of 5 stars for safety and soundness. Keep reading for a breakdown of how the credit union faired on the three major criteria Bankrate used to score U.S. credit unions.

WHAT IS
SAFE AND SOUND?

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THE INSTITUTION'S SCORE

Capital Score

Capital is an essential measurement of an institution's financial resilience. It acts as a bulwark against losses and affords protection for members when a credit union is struggling financially. When it comes to safety and soundness, the more capital, the better.

LONE STAR received a score of 4 out of a possible 30 points on our test to measure capital adequacy, lower than the national average of 15.65.

LONE STAR's capitalization ratio of 4.00 percent in our test was below the average for all credit unions, an indication that it's less well prepared for financial trouble than its peers.

Asset Quality Score

In this test, Bankrate tries to determine 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 extensive holdings of these types of assets could eventually be required to use capital to absorb losses, decreasing its equity buffer. It also means that there are likely to be many assets that are in non-accrual status and no longer earning money, resulting in diminished earnings and potentially more risk of a failure in the future.

On Bankrate's asset quality test, LONE STAR scored 40 out of a possible 40 points, exceeding the national average of 38.09 points.

A below-average ratio of problem assets of 0.00 percent in our test was potentially indicative of greater financial strength than other credit unions.

Earnings score

A credit union's ability to earn money affects its safety and soundness. Earnings may be retained by the credit union, expanding its capital cushion, or be used to deal with problematic loans, likely making the credit union better prepared to withstand financial shocks. Losses, on the other hand, lessen a credit union's ability to do those things.

LONE STAR scored 0 out of a possible 30 on Bankrate's earnings test, falling short of the national average of 10.11.

The credit union had an earnings ratio of 0.00 percent in our test, better than the average for all credit unions, suggesting that it's running ahead of 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.