Safe and Sound

MTCU

Midland, TX
3
Star Rating
Midland, TX-based MTCU is an NCUA-insured credit union founded in 1955. Regulatory filings show the credit union having assets of $121.7 million, as of December 31, 2017.

Members have $63.8 million on deposit tended by 37 full-time employees. With that footprint, the credit union holds loans and leases worth $63.8 million. Its 7,995 members currently have $110.1 million in shares with the credit union.

Overall, Bankrate believes that, as of December 31, 2017, MTCU exhibited a generally satisfactory condition, earning 3 out of 5 stars for safety and soundness. Keep reading for an analysis of how the credit union faired on the three major criteria Bankrate used to score American credit unions.

WHAT IS
SAFE AND SOUND?

Find out

THE INSTITUTION'S SCORE

Capital Score

Capital works as a cushion against losses and affords protection for members during times of financial trouble for the credit union. It follows then that when it comes to measuring an a credit union's financial resilience, capital is crucial. When it comes to safety and soundness, the higher the capital, the better.

MTCU finished below the national average of 15.65 on our test to measure capital adequacy, scoring 8 out of a possible 30 points.

MTCU's capitalization ratio of 8.00 percent in our test was lower than the average for all credit unions, suggesting that it's less well prepared for financial trouble than its peers.

Asset Quality Score

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

Having a large number of these kinds of assets means a credit union could eventually have to use capital to absorb losses, diminishing its buffer of equity. It also means that there are likely to be many assets that are in non-accrual status and no longer earning money, resulting in lower earnings and potentially more risk of a future failure.

MTCU did better than the national average of 38.09 on Bankrate's test of asset quality, racking up 40 out of a possible 40 points .

MTCU's ratio of problem assets was 0.00 percent in our test, beneath the national average and suggestive of superior financial strength compared to other credit unions.

Earnings score

How successful a credit union is at earning money has an effect on its safety and soundness. A credit union can retain its earnings, boosting its capital buffer, or use them to address problematic loans, likely making the credit union better prepared to withstand economic shocks. Conversely, losses reduce a credit union's ability to do those things.

On Bankrate's test of earnings, MTCU scored 4 out of a possible 30, below the national average of 10.11.

One sign that MTCU is beating 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.