Safe and Sound

MCKESSON

STRATFORD, CT
3
Star Rating
MCKESSON is a STRATFORD, CT-based, NCUA-insured credit union started in 1936. Regulatory filings show the credit union having $23.6 million in assets, as of December 31, 2017.

With 4 full-time employees, the credit union has amassed loans and leases worth $7.1 million. MCKESSON's 3,228 members currently have $21.1 million in shares with the credit union.

Overall, Bankrate believes that, as of December 31, 2017, MCKESSON 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 key criteria Bankrate used to grade American 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 experiencing economic trouble. Therefore, a credit union's level of capital is a crucial measurement of its financial strength. From a safety and soundness perspective, more capital is better.

On our test to measure capital adequacy, MCKESSON received a score of 12 out of a possible 30 points, less than the national average of 15.65.

MCKESSON appears to be less well prepared for financial trouble than its peers in this area, with a capitalization ratio of 12.00 percent in our test, worse than the average for all credit unions.

Asset Quality Score

This test is intended to estimate how the credit union's capitalization and allocated loan loss reserves could be affected by problem assets, such as unpaid mortgages.

A credit union with a large number of these kinds of assets may eventually have to use capital to absorb losses, decreasing its equity cushion. It also means that there are likely to be many assets that are in non-accrual status and thus aren't earning interest for the credit union, diminishing earnings and elevating the chances of a failure in the future.

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

MCKESSON's ratio of troubled assets was 0.00 percent in our test, less than the national average and suggestive 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 may be retained by the credit union, giving a boost to its capital buffer, or be used to address problematic loans, potentially making the credit union better able to withstand economic trouble. Credit unions that are losing money, however, are less able to do those things.

MCKESSON fell short of the national average on Bankrate's test of earnings, achieving a score of 2 out of a possible 30.

One sign that the credit union is running ahead of its peers in this area was its earnings ratio of 0.00 percent in our test, higher 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.