Safe and Sound

MIDWEST COMMUNITY

Sioux City, IA
4
Star Rating
Sioux City, IA-based MIDWEST COMMUNITY is an NCUA-insured credit union started in 1955. Regulatory filings show the credit union having assets of $31.0 million, as of December 31, 2017.

Thanks to the work of 7 full-time employees, the credit union currently holds loans and leases worth $8.4 million. Its 3,024 members currently have $28.2 million in shares with the credit union.

Overall, Bankrate believes that, as of December 31, 2017, MIDWEST COMMUNITY exhibited a good condition, earning 4 out of 5 stars for safety and soundness. Here's a breakdown of how the credit union did on the three key criteria Bankrate used to grade U.S. credit unions.

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THE INSTITUTION'S SCORE

Capital Score

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

MIDWEST COMMUNITY fell below the national average of 15.65 on our test to measure capital adequacy, achieving a score of 8 out of a possible 30 points.

MIDWEST COMMUNITY appears to be on less solid financial footing than its peers in this area, with a capitalization ratio of 8.00 percent in our test, less than the average for all credit unions.

Asset Quality Score

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

A credit union with lots of these types of assets could eventually be required to use capital to absorb losses, reducing its buffer of equity. Many of those assets are also likely to be in non-accrual status and no longer earning money, reducing earnings and increasing the chances of a future failure.

On Bankrate's asset quality test, MIDWEST COMMUNITY scored 40 out of a possible 40 points, beating the national average of 38.09 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.

Earnings score

How successful a credit union is at making money has an effect on its long-term survivability. A credit union can retain its earnings, boosting its capital cushion, or use them to deal with problematic loans, potentially making the credit union more resilient in tough times. Conversely, losses lessen a credit union's ability to do those things.

MIDWEST COMMUNITY scored 14 out of a possible 30 on Bankrate's earnings test, beating the national average of 10.11.

MIDWEST COMMUNITY 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.