Safe and Sound

MARBLEHEAD MUNICIPAL

MARBLEHEAD, MA
5
Star Rating
Started in 1978, MARBLEHEAD MUNICIPAL is an NCUA-insured credit union based in MARBLEHEAD, MA. The credit union has $9.5 million in assets, according to December 31, 2017, regulatory filings.

The credit union has amassed loans and leases worth $5.0 million. MARBLEHEAD MUNICIPAL's 1,360 members currently have $7.8 million in shares with the credit union.

Overall, Bankrate believes that, as of December 31, 2017, MARBLEHEAD MUNICIPAL exhibited a superior condition, earning a full 5 stars for safety and soundness. Keep reading for a breakdown of how the credit union did on the three key criteria Bankrate used to evaluate American credit unions on safety and soundness.

WHAT IS
SAFE AND SOUND?

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THE INSTITUTION'S SCORE

Capital Score

Capital acts as a bulwark against losses and as protection for members during periods of economic instability for the credit union. Therefore, a credit union's level of capital is an important measurement of its financial strength. When it comes to safety and soundness, the higher the capital, the better.

MARBLEHEAD MUNICIPAL exceeded the national average of 15.65 points on our test to measure the adequacy of a credit union's capital, receiving a score of 26 out of a possible 30 points.

MARBLEHEAD MUNICIPAL's capitalization ratio of 26.00 percent in our test was higher than the average for all credit unions, an indication that it's stronger than its peers.

Asset Quality Score

Bankrate uses this test to estimate the effect of problem assets, such as unpaid mortgages, on the credit union's reserves set aside to cover loan losses, as well as overall capitalization.

Having lots of these kinds of assets may eventually require a credit union to use capital to absorb losses, cutting down on its buffer of equity. Many of those assets are also likely to be in non-accrual status and no longer earning interest for the credit union, resulting in lower earnings and potentially more risk of a future failure.

MARBLEHEAD MUNICIPAL did better than the national average of 38.09 on Bankrate's asset quality test, racking up 40 out of a possible 40 points .

A lower-than-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. A credit union can retain its earnings, expanding its capital cushion, or put them to work addressing problematic loans, likely making the credit union more resilient in times of trouble. Conversely, losses lessen a credit union's ability to do those things.

On Bankrate's earnings test, MARBLEHEAD MUNICIPAL scored 6 out of a possible 30, coming in below the national average of 10.11.

One sign that the credit union is beating its peers in this area was its earnings ratio of 0.00 percent in our test, better than 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.