Safe and Sound

MUNICIPAL EMPLOYEES

BOGALUSA, LA
5
Star Rating
BOGALUSA, LA-based MUNICIPAL EMPLOYEES is an NCUA-insured credit union started in 1955. The credit union holds $1.3 million in assets, according to December 31, 2017, regulatory filings.

MUNICIPAL EMPLOYEES's 193 members currently have $1.0 million in shares with the credit union. With that footprint, the credit union has amassed loans and leases worth $239,063.

Overall, Bankrate believes that, as of December 31, 2017, MUNICIPAL EMPLOYEES exhibited a superior condition, earning a full 5 stars for safety and soundness. Keep reading for an analysis of how the credit union faired on the three key criteria Bankrate used to grade U.S. credit unions on safety and soundness.

WHAT IS
SAFE AND SOUND?

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THE INSTITUTION'S SCORE

Capital Score

When it comes to measuring an institution's financial stability, capital is key. It acts as a cushion against losses and affords protection for members when a credit union is experiencing financial trouble. When looking at safety and soundness, more capital is preferred.

MUNICIPAL EMPLOYEES racked up 30 out of a possible 30 points on our test to measure capital adequacy, exceeding the national average of 15.65.

MUNICIPAL EMPLOYEES appears to be stronger than its peers, with a capitalization ratio of 30.00 percent in our test, above the average for all credit unions.

Asset Quality Score

Bankrate uses this test to determine the effect of problem assets, such as unpaid mortgages, on the credit union's reserves set aside to cover loan losses, as well as overall capitalization.

A credit union with lots of these types of assets could eventually be required to use capital to absorb losses, cutting down on its equity buffer. Many of those assets are also likely to be in non-accrual status and no longer earning money, resulting in lower earnings and potentially more risk of a future failure.

On Bankrate's asset quality test, MUNICIPAL EMPLOYEES scored 40 out of a possible 40 points, beating out 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

A credit union's earnings performance affects its long-term survivability. A credit union can retain its earnings, increasing its capital buffer, or use them to deal with problematic loans, likely making the credit union better able to withstand economic shocks. Obviously, credit unions that are losing money are less able to do those things.

MUNICIPAL EMPLOYEES did below-average on Bankrate's earnings test, achieving a score of 2 out of a possible 30.

One indication that the credit union is outperforming 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.