Safe and Sound

NEWARK POLICE

Newark, NJ
5
Star Rating
NEWARK POLICE is a Newark, NJ-based, NCUA-insured credit union dating back to 1941. The credit union has assets of $6.3 million, according to December 31, 2017, regulatory filings.

With 2 full-time employees, the credit union holds loans and leases worth $3.0 million. Its 1,567 members currently have $4.8 million in shares with the credit union.

Overall, Bankrate believes that, as of December 31, 2017, NEWARK POLICE exhibited a superior condition, earning a full 5 stars for safety and soundness. Here's an analysis of how the credit union did on the three key criteria Bankrate used to grade American credit unions on safety and soundness.

WHAT IS
SAFE AND SOUND?

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THE INSTITUTION'S SCORE

Capital Score

When it comes to measuring an institution's financial fortitude, capital is crucial. It acts as a bulwark against losses and provides protection for members when a credit union is struggling financially. When it comes to safety and soundness, the higher the capital, the better.

NEWARK POLICE racked up 30 out of a possible 30 points on our test to measure capital adequacy, beating out the national average of 15.65.

NEWARK POLICE's capitalization ratio of 30.00 percent in our test was above the average for all credit unions, suggesting that it's stronger than its peers.

Asset Quality Score

This test's purpose is to estimate 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 large numbers of these kinds of assets could eventually have to use capital to cover 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, pushing down earnings and increasing the chances of a future failure.

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

A below-average ratio of troubled assets of 0.00 percent in our test was potentially indicative of superior financial strength compared to other credit unions.

Earnings score

A credit union's earnings performance has an effect on its safety and soundness. Earnings can be retained by the credit union, increasing its capital buffer, or be used to deal with problematic loans, potentially making the credit union more resilient in tough times. Losses, on the other hand, diminish a credit union's ability to do those things.

NEWARK POLICE scored 10 out of a possible 30 on Bankrate's test of earnings, coming in below the national average of 10.11.

One indication that the credit union is beating 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.