Safe and Sound

LOWLAND

Morristown, TN
3
Star Rating
Morristown, TN-based LOWLAND is an NCUA-insured credit union founded in 1953. As of December 31, 2017, the credit union held assets of $95.8 million.

Members have $60.4 million on deposit tended by 30 full-time employees. With that footprint, the credit union currently holds loans and leases worth $60.4 million. Its 12,690 members currently have $87.3 million in shares with the credit union.

Overall, Bankrate believes that, as of December 31, 2017, LOWLAND exhibited a generally satisfactory condition, earning 3 out of 5 stars for safety and soundness. Here's an analysis of how the credit union did on the three major criteria Bankrate used to score U.S. credit unions.

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THE INSTITUTION'S SCORE

Capital Score

Capital acts as a bulwark against losses and provides protection for members when a credit union is experiencing financial instability. Therefore, an institution's level of capital is a valuable measurement of its financial fortitude. When looking at safety and soundness, the more capital, the better.

On our test to measure capital adequacy, LOWLAND received a score of 8 out of a possible 30 points, less than the national average of 15.65.

LOWLAND had a capitalization ratio of 8.00 percent in our test, lower than the average for all credit unions, suggesting that it's on less solid financial footing than its peers.

Asset Quality Score

In this test, Bankrate tries to estimate the impact of troubled assets, such as past-due mortgages, on the credit union's loan loss reserves and overall capitalization.

A credit union with extensive holdings of these kinds of assets may eventually be required to use capital to absorb losses, shrinking 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 risk of a future failure.

LOWLAND scored 36 out of a possible 40 points on Bankrate's test of asset quality, falling short of the national average of 38.09.

LOWLAND's ratio of troubled assets was 0.00 percent in our test, lower than the national average and potentially indicative of greater financial strength than other credit unions.

Earnings score

How successful a credit union is at earning money affects its long-term survivability. Earnings can be retained by the credit union, boosting its capital buffer, or be used to address problematic loans, likely making the credit union more resilient in tough times. Obviously, credit unions that are losing money are less able to do those things.

LOWLAND received below-average marks on Bankrate's earnings test, achieving a score of 2 out of a possible 30.

One sign that LOWLAND is beating its peers in this area was its earnings ratio of 0.00 percent in our test, above the average for all credit unions.

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.