Safe and Sound

MEMBERS CHOICE FINANCIAL

DANVILLE, PA
3
Star Rating
Founded in 1954, MEMBERS CHOICE FINANCIAL is an NCUA-insured credit union headquartered in DANVILLE, PA. As of December 31, 2017, the credit union had assets of $145.8 million.

Members have $111.1 million on deposit tended by 42 full-time employees. With that footprint, the credit union holds loans and leases worth $111.1 million. Its 12,909 members currently have $132.3 million in shares with the credit union.

Overall, Bankrate believes that, as of December 31, 2017, MEMBERS CHOICE FINANCIAL exhibited a generally satisfactory condition, earning 3 out of 5 stars for safety and soundness. Keep reading for a breakdown of how the credit union faired on the three key criteria Bankrate used to evaluate U.S. credit unions.

WHAT IS
SAFE AND SOUND?

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THE INSTITUTION'S SCORE

Capital Score

Capital works as a bulwark against losses and as protection for members during times of financial trouble for the credit union. It follows then that an institution's level of capital is a key measurement of its financial strength. When looking at safety and soundness, the higher the capital, the better.

MEMBERS CHOICE FINANCIAL received a score of 8 out of a possible 30 points on our test to measure capital adequacy, less than the national average of 15.65.

MEMBERS CHOICE FINANCIAL had a capitalization ratio of 8.00 percent in our test, lower than the average for all credit unions, a sign that it's weaker than its peers.

Asset Quality Score

This test's purpose is to estimate how the credit union's capitalization and allocated loan loss reserves could be affected by troubled assets, such as past-due mortgages.

Having lots of these types of assets could eventually require a credit union to use capital to absorb 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, reducing earnings and elevating the chances of a future failure.

On Bankrate's test of asset quality, MEMBERS CHOICE FINANCIAL scored 28 out of a possible 40 points, less than the national average of 38.09 points.

The credit union's ratio of troubled assets was 0.00 percent in our test, lower than 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 long-term survivability. Earnings can be retained by the credit union, expanding its capital buffer, or be used to address problematic loans, potentially making the credit union better prepared to withstand financial shocks. Obviously, credit unions that are losing money are less able to do those things.

On Bankrate's earnings test, MEMBERS CHOICE FINANCIAL scored 10 out of a possible 30, coming in below the national average of 10.11.

The credit union had an earnings ratio of 0.00 percent in our test, above the average for all credit unions, an indication that it's doing better than its peers in this area.

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.