Safe and Sound

MICHIGAN FIRST

LATHRUP VILLAGE, MI
4
Star Rating
Founded in 1926, MICHIGAN FIRST is an NCUA-insured credit union headquartered in LATHRUP VILLAGE, MI. As of December 31, 2017, the credit union had assets of $863.5 million.

With 365 full-time employees, the credit union holds loans and leases worth $593.2 million. Its 138,741 members currently have $638.1 million in shares with the credit union.

Overall, Bankrate believes that, as of December 31, 2017, MICHIGAN FIRST exhibited a good condition, earning 4 out of 5 stars for safety and soundness. Keep reading for a breakdown of how the credit union faired on the three important criteria Bankrate used to score U.S. credit unions.

WHAT IS
SAFE AND SOUND?

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THE INSTITUTION'S SCORE

Capital Score

Capital acts as a buffer against losses and as protection for members during periods of economic instability for the credit union. It follows then that a credit union's level of capital is a key measurement of its financial resilience. When it comes to safety and soundness, the higher the capital, the better.

MICHIGAN FIRST achieved a score of 18 out of a possible 30 points on our test to measure capital adequacy, above the national average of 15.65.

MICHIGAN FIRST's capitalization ratio of 18.00 percent in our test was higher than the average for all credit unions, a sign that it's stronger than its peers.

Asset Quality Score

This test is intended to estimate how the credit union's reserves set aside to cover loan losses, as well as overall capitalization could be affected by problem assets, such as past-due mortgages.

A credit union with lots of these kinds of assets may eventually be forced 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 no longer earning money, resulting in depressed earnings and potentially more risk of a future failure.

MICHIGAN FIRST scored 36 out of a possible 40 points on Bankrate's test of asset quality, coming in below the national average of 38.09.

MICHIGAN FIRST's ratio of troubled assets was 0.00 percent in our test, below the national average and potentially indicative of greater financial strength than other credit unions.

Earnings score

How successful a credit union is at making money has an effect on its long-term survivability. Earnings may be retained by the credit union, giving a boost to its capital cushion, or be used to deal with problematic loans, likely making the credit union better prepared to withstand financial shocks. Obviously, credit unions that are losing money have less ability to do those things.

MICHIGAN FIRST underperformed the average on Bankrate's test of earnings, achieving a score of 8 out of a possible 30.

One indication that the credit union is doing better than 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.