Asset Quality Score
Bankrate uses this test to determine the impact of troubled assets, such as unpaid mortgages, on the credit union's reserves set aside to cover loan losses, as well as overall capitalization.
A credit union with lots of these kinds of assets could eventually be required to use capital to absorb losses, cutting down on 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 interest for the credit union, decreasing earnings and increasing the chances of a future failure.
M. A. FORD EMPLOYEES scored below the national average of 38.09 on Bankrate's asset quality test, racking up 36 out of a possible 40 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.