Safe and Sound

N. J. LATVIAN

Freehold, NJ
3
Star Rating
N. J. LATVIAN is a Freehold, NJ-based, NCUA-insured credit union founded in 1971. As of December 31, 2017, the credit union held assets of $10.6 million.

N. J. LATVIAN's 222 members currently have $7.4 million in shares with the credit union. With that footprint, the credit union has amassed loans and leases worth $253,103.

Overall, Bankrate believes that, as of December 31, 2017, N. J. LATVIAN exhibited a generally satisfactory condition, earning 3 out of 5 stars for safety and soundness. Here's a breakdown of how the credit union did on the three major criteria Bankrate used to score American credit unions.

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THE INSTITUTION'S SCORE

Capital Score

When it comes to measuring a credit union's financial resilience, capital is useful. It acts as a bulwark against losses and provides protection for members when a credit union is experiencing financial trouble. When looking at safety and soundness, more capital is better.

N. J. LATVIAN received a score of 8 out of a possible 30 points on our test to measure capital adequacy, lower than the national average of 15.65.

N. J. LATVIAN had a capitalization ratio of 8.00 percent in our test, lower than the average for all credit unions, suggesting that it's on less solid financial footing than its peers.

Asset Quality Score

In this test, Bankrate tries to estimate 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.

Having lots of these types of assets suggests a credit union could eventually have to use capital to cover losses, cutting down on its cushion of equity. Many of those assets are also likely to be in non-accrual status and no longer earning money, pushing down earnings and increasing the risk of a failure in the future.

N. J. LATVIAN scored 40 out of a possible 40 points on Bankrate's asset quality test, exceeding the national average of 38.09.

A lower-than-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 earning money affects its safety and soundness. Earnings can be retained by the credit union, giving a boost to its capital buffer, or be used to address problematic loans, potentially making the credit union better prepared to withstand financial shocks. Losses, on the other hand, lessen a credit union's ability to do those things.

On Bankrate's test of earnings, N. J. LATVIAN scored 0 out of a possible 30, lower than the national average of 10.11.

The credit union had an earnings ratio of 0.00 percent in our test, higher than the average for all credit unions, suggesting 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.