Safe and Sound

NCE

CORPUS CHRISTI, TX
5
Star Rating
CORPUS CHRISTI, TX-based NCE is an NCUA-insured credit union started in 1966. As of December 31, 2017, the credit union held assets of $5.4 million.

Members have $3.3 million on deposit tended by 4 full-time employees. With that footprint, the credit union currently holds loans and leases worth $3.3 million. NCE's 1,200 members currently have $4.2 million in shares with the credit union.

Overall, Bankrate believes that, as of December 31, 2017, NCE exhibited a superior condition, earning a full 5 stars for safety and soundness. Here's a look at how the credit union did on the three major 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

Capital is a valuable measurement of a credit union's financial fortitude. It works as a buffer against losses and as protection for members when a credit union is experiencing economic instability. When looking at safety and soundness, the more capital, the better.

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

NCE's capitalization ratio of 30.00 percent in our test was better than the average for all credit unions, suggesting that it's more well prepared for financial trouble than its peers.

Asset Quality Score

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

Having a large number of these types of assets means a credit union could have to use capital to cover losses, cutting down on 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, reducing earnings and increasing the risk of a failure in the future.

On Bankrate's asset quality test, NCE scored 40 out of a possible 40 points, beating out the national average of 38.09 points.

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 making money has an effect on its long-term survivability. A credit union can retain its earnings, boosting its capital cushion, or put them to work addressing problematic loans, potentially making the credit union more resilient in times of trouble. Losses, on the other hand, reduce a credit union's ability to do those things.

NCE scored 8 out of a possible 30 on Bankrate's earnings test, coming in below the national average of 10.11.

One indication that NCE is running ahead of 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.