Safe and Sound

NAVY ARMY COMMUNITY

CORPUS CHRISTI, TX
4
Star Rating
Founded in 1955, NAVY ARMY COMMUNITY is an NCUA-insured credit union based in CORPUS CHRISTI, TX. The credit union holds $2.70 billion in assets, according to December 31, 2017, regulatory filings.

With 443 full-time employees, the credit union currently holds loans and leases worth $2.41 billion. NAVY ARMY COMMUNITY's 161,563 members currently have $2.41 billion in shares with the credit union.

Overall, Bankrate believes that, as of December 31, 2017, NAVY ARMY COMMUNITY exhibited a good condition, earning 4 out of 5 stars for safety and soundness. Keep reading for a look at how the credit union did on the three key criteria Bankrate used to grade American credit unions.

WHAT IS
SAFE AND SOUND?

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THE INSTITUTION'S SCORE

Capital Score

Capital acts as a buffer against losses and provides protection for members during periods of financial instability for the credit union. It follows then that when it comes to measuring an a credit union's financial stability, capital is key. From a safety and soundness perspective, the more capital, the better.

On our test to measure capital adequacy, NAVY ARMY COMMUNITY received a score of 12 out of a possible 30 points, lower than the national average of 15.65.

NAVY ARMY COMMUNITY's capitalization ratio of 12.00 percent in our test was less than the average for all credit unions, an indication that it could have a harder time weathering 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 unpaid loans.

Having a large number of these types of assets may 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 no longer earning interest for the credit union, diminishing earnings and increasing the chances of a future failure.

NAVY ARMY COMMUNITY came in below the national average of 38.09 on Bankrate's test of asset quality, racking up 28 out of a possible 40 points .

A below-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

How successful a credit union is at making money affects its long-term survivability. A credit union can retain its earnings, increasing its capital buffer, or put them to work addressing problematic loans, likely making the credit union more resilient in times of trouble. Obviously, credit unions that are losing money have less ability to do those things.

NAVY ARMY COMMUNITY received above-average marks on Bankrate's test of earnings, achieving a score of 18 out of a possible 30.

One sign that the credit union is outperforming 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.