Safe and Sound

MENOMINEE AREA

MENOMINEE, MI
4
Star Rating
MENOMINEE AREA is a MENOMINEE, MI-based, NCUA-insured credit union started in 1954. The credit union holds $9.4 million in assets, according to June 30, 2017, regulatory filings.

Members have $4.3 million on deposit tended by 5 full-time employees. With that footprint, the credit union currently holds loans and leases worth $4.3 million. MENOMINEE AREA's 1,361 members currently have $7.9 million in shares with the credit union.

Overall, Bankrate believes that, as of June 30, 2017, MENOMINEE AREA exhibited a good condition, earning 4 out of 5 stars for safety and soundness. Here's a breakdown of how the credit union faired on the three key criteria Bankrate used to score American credit unions.

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THE INSTITUTION'S SCORE

Capital Score

When it comes to measuring an institution's financial stability, capital is essential. It works as a bulwark against losses and provides protection for members during times of financial trouble for the credit union. From a safety and soundness perspective, more capital is preferred.

MENOMINEE AREA racked up 22 out of a possible 30 points on our test to measure capital adequacy, exceeding the national average of 15.26.

MENOMINEE AREA's capitalization ratio of 16.00 percent in our test was better than the average for all credit unions, an indication that it's on more solid financial footing than its peers.

Asset Quality Score

This test is intended to try to understand how the credit union's loan loss reserves and overall capitalization could be affected by troubled assets, such as past-due loans.

Having extensive holdings of these kinds of assets may eventually force a credit union to use capital to cover losses, cutting down on 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, resulting in diminished earnings and potentially more risk of a failure in the future.

MENOMINEE AREA did better than the national average of 38.15 on Bankrate's test of asset quality, racking up 40 out of a possible 40 points .

A lower-than-average ratio of troubled assets of 1.00 percent in our test was potentially indicative of greater financial strength than other credit unions.

Earnings score

How successful a credit union is at earning money has an effect on its long-term survivability. Earnings can be retained by the credit union, boosting its capital buffer, or be used to address problematic loans, likely making the credit union more resilient in times of trouble. Losses, on the other hand, reduce a credit union's ability to do those things.

MENOMINEE AREA scored 0 out of a possible 30 on Bankrate's earnings test, less than the national average of 10.31.

MENOMINEE AREA had an earnings ratio of -2.00 percent in our test, worse than the average for all credit unions, a sign that it's running behind 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.