Safe and Sound

NAFT

Pharr, TX
5
Star Rating
NAFT is an NCUA-insured credit union founded in 1956 and currently based in Pharr, TX. Regulatory filings show the credit union having $80.9 million in assets, as of December 31, 2017.

With 30 full-time employees, the credit union currently holds loans and leases worth $45.1 million. Its 11,031 members currently have $68.8 million in shares with the credit union.

Overall, Bankrate believes that, as of December 31, 2017, NAFT exhibited a superior condition, earning a full 5 stars for safety and soundness. Keep reading for a look at how the credit union faired on the three major criteria Bankrate used to evaluate American credit unions on safety and soundness.

WHAT IS
SAFE AND SOUND?

Find out

THE INSTITUTION'S SCORE

Capital Score

Capital is a useful measurement of a credit union's financial strength. It acts as a bulwark against losses and affords protection for members during periods of financial trouble for the credit union. When looking at safety and soundness, more capital is better.

On our test to measure capital adequacy, NAFT racked up 18 out of a possible 30 points, above the national average of 15.65.

NAFT appears to be on more solid financial footing than its peers, with a capitalization ratio of 18.00 percent in our test, better than the average for all credit unions.

Asset Quality Score

In this test, Bankrate tries to estimate the effect of troubled assets, such as past-due loans, on the credit union's loan loss reserves and overall capitalization.

Having large numbers of these kinds of assets could eventually force a credit union to use capital to absorb losses, shrinking its equity cushion. It also means that there are likely to be many assets that are in non-accrual status and thus aren't earning money, resulting in lower earnings and potentially more risk of a future failure.

NAFT scored 40 out of a possible 40 points on Bankrate's test of asset quality, above the national average of 38.09.

A lower-than-average ratio of troubled assets of 0.00 percent in our test was potentially indicative of greater financial strength than other credit unions.

Earnings score

A credit union's profitability has an effect on its long-term survivability. A credit union can retain its earnings, increasing its capital cushion, or put them to work addressing problematic loans, potentially making the credit union better able to withstand financial trouble. Obviously, credit unions that are losing money have less ability to do those things.

NAFT scored 18 out of a possible 30 on Bankrate's earnings test, above the national average of 10.11.

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, better 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.