Safe and Sound

MERCER COUNTY IMPROVEMENT AUTHORITY

HAMILTON, NJ
5
Star Rating
HAMILTON, NJ-based MERCER COUNTY IMPROVEMENT AUTHORITY is an NCUA-insured credit union started in 1936. The credit union has $381,080 in assets, according to December 31, 2017, regulatory filings.

The credit union currently holds loans and leases worth $238,993. MERCER COUNTY IMPROVEMENT AUTHORITY's 186 members currently have $286,102 in shares with the credit union.

Overall, Bankrate believes that, as of December 31, 2017, MERCER COUNTY IMPROVEMENT AUTHORITY exhibited a superior condition, earning a full 5 stars for safety and soundness. Keep reading for a look at how the credit union did on the three major criteria Bankrate used to score American credit unions on safety and soundness.

WHAT IS
SAFE AND SOUND?

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THE INSTITUTION'S SCORE

Capital Score

Capital acts as a bulwark against losses and provides protection for members during periods of economic trouble for the credit union. It follows then that when it comes to measuring an a credit union's financial resilience, capital is useful. When it comes to safety and soundness, more capital is better.

On our test to measure the adequacy of a credit union's capital, MERCER COUNTY IMPROVEMENT AUTHORITY achieved a score of 30 out of a possible 30 points, beating the national average of 15.65.

MERCER COUNTY IMPROVEMENT AUTHORITY's capitalization ratio of 30.00 percent in our test was better than the average for all credit unions, suggesting that it's more well prepared for financial trouble than its peers.

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 loans.

Having large numbers of these types of assets suggests a credit union may eventually have to use capital to cover 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, resulting in diminished earnings and potentially more risk of a future failure.

MERCER COUNTY IMPROVEMENT AUTHORITY scored 36 out of a possible 40 points on Bankrate's asset quality test, failing to reach the national average of 38.09.

Troubled assets made up 0.00 percent of MERCER COUNTY IMPROVEMENT AUTHORITY's total assets 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 affects its long-term survivability. A credit union can retain its earnings, boosting its capital cushion, or put them to work addressing problematic loans, potentially making the credit union better able to withstand financial trouble. Conversely, losses diminish a credit union's ability to do those things.

MERCER COUNTY IMPROVEMENT AUTHORITY scored 10 out of a possible 30 on Bankrate's test of earnings, less than the national average of 10.11.

One sign that MERCER COUNTY IMPROVEMENT AUTHORITY is running ahead of its peers in this area was its earnings ratio of 0.00 percent in our test, above 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.