Asset Quality Score
In this test, Bankrate tries to determine the effect of problem assets, such as past-due loans, on the credit union's reserves set aside to cover loan losses, as well as overall capitalization.
A credit union with large numbers of these types of assets could eventually be required to use capital to cover losses, reducing its equity buffer. It also means that there are likely to be many assets that are in non-accrual status and no longer earning money, pushing down earnings and increasing the risk of a failure in the future.
MEMBER'S 1ST OF NJ finished below the national average of 38.09 on Bankrate's test of asset quality, 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 superior financial strength compared to other credit unions.