Safe and Sound

NEW HORIZON

DANVILLE, IL
4
Star Rating
DANVILLE, IL-based NEW HORIZON is an NCUA-insured credit union started in 1946. As of December 31, 2017, the credit union had assets of $12.6 million.

Members have $7.4 million on deposit tended by 3 full-time employees. With that footprint, the credit union has amassed loans and leases worth $7.4 million. Its 1,860 members currently have $11.1 million in shares with the credit union.

Overall, Bankrate believes that, as of December 31, 2017, NEW HORIZON exhibited a good condition, earning 4 out of 5 stars for safety and soundness. Keep reading for a breakdown of how the credit union faired on the three important criteria Bankrate used to score American credit unions.

WHAT IS
SAFE AND SOUND?

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THE INSTITUTION'S SCORE

Capital Score

Capital is an essential measurement of a credit union's financial fortitude. It acts as a cushion against losses and affords protection for members when a credit union is experiencing financial instability. From a safety and soundness perspective, the higher the capital, the better.

NEW HORIZON scored above the national average of 15.65 points on our test to measure the adequacy of a credit union's capital, scoring 16 out of a possible 30 points.

NEW HORIZON's capitalization ratio of 16.00 percent in our test puts it right in line with the average for all credit unions.

Asset Quality Score

This test's purpose is to try to understand how the credit union's loan loss reserves and overall capitalization could be affected by problem assets, such as unpaid mortgages.

A credit union with lots of these kinds of assets could eventually be required to use capital to absorb losses, reducing its equity buffer. Many of those assets are also likely to be in non-accrual status and no longer earning interest for the credit union, reducing earnings and elevating the chances of a failure in the future.

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

NEW HORIZON's ratio of problem assets was 0.00 percent in our test, below the national average and suggestive of superior financial strength compared to other credit unions.

Earnings score

A credit union's ability to earn money affects its long-term survivability. Earnings may be retained by the credit union, increasing its capital buffer, or be used to address problematic loans, potentially making the credit union better prepared to withstand economic trouble. Conversely, losses lessen a credit union's ability to do those things.

NEW HORIZON scored 0 out of a possible 30 on Bankrate's earnings test, 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 outperforming 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.