Safe and Sound

MCKESSON EMPLOYEES

San Francisco, CA
2
Star Rating
MCKESSON EMPLOYEES is a San Francisco, CA-based, NCUA-insured credit union founded in 1938. The credit union has $26.8 million in assets, according to December 31, 2017, regulatory filings.

Members have $21.8 million on deposit tended by 6 full-time employees. With that footprint, the credit union currently holds loans and leases worth $21.8 million. MCKESSON EMPLOYEES's 5,243 members currently have $24.4 million in shares with the credit union.

Overall, Bankrate believes that, as of December 31, 2017, MCKESSON EMPLOYEES exhibited a below-average condition, earning 2 out of 5 stars for safety and soundness. Here's a look at how the credit union faired on the three major criteria Bankrate used to evaluate U.S. credit unions.

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THE INSTITUTION'S SCORE

Capital Score

Capital works as a cushion against losses and provides protection for members when a credit union is struggling financially. It follows then that an institution's level of capital is a valuable measurement of its financial resilience. From a safety and soundness perspective, the more capital, the better.

MCKESSON EMPLOYEES scored below the national average of 15.65 on our test to measure capital adequacy, receiving a score of 8 out of a possible 30 points.

MCKESSON EMPLOYEES's capitalization ratio of 8.00 percent in our test was less than the average for all credit unions, suggesting that it could have a harder time weathering financial trouble than its peers.

Asset Quality Score

Bankrate uses this test to determine the impact of problem assets, such as unpaid loans, on the credit union's capitalization and allocated loan loss reserves.

Having extensive holdings of these types of assets means a credit union may eventually have to use capital to absorb losses, cutting down on its cushion of equity. Many of those assets are also likely to be in non-accrual status and thus aren't earning interest for the credit union, resulting in diminished earnings and potentially more risk of a failure in the future.

MCKESSON EMPLOYEES scored 24 out of a possible 40 points on Bankrate's asset quality test, less than the national average of 38.09.

Troubled assets made up 0.00 percent of MCKESSON EMPLOYEES's total assets in our test, beneath the national average and potentially indicative of superior financial strength compared to other credit unions.

Earnings score

A credit union's ability to earn money has an effect on its safety and soundness. A credit union can retain its earnings, boosting its capital buffer, or use them to deal with problematic loans, likely making the credit union better able to withstand economic trouble. Credit unions that are losing money, however, are less able to do those things.

On Bankrate's earnings test, MCKESSON EMPLOYEES scored 4 out of a possible 30, lower than the national average of 10.11.

One sign that MCKESSON EMPLOYEES is outperforming 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.