Safe and Sound

NORTH EAST WELCH

NORTH EAST, PA
4
Star Rating
NORTH EAST WELCH is a NORTH EAST, PA-based, NCUA-insured credit union founded in 1953. As of December 31, 2017, the credit union held assets of $17.5 million.

Members have $9.5 million on deposit tended by 8 full-time employees. With that footprint, the credit union has amassed loans and leases worth $9.5 million. NORTH EAST WELCH's 2,777 members currently have $14.9 million in shares with the credit union.

Overall, Bankrate believes that, as of December 31, 2017, NORTH EAST WELCH exhibited a good condition, earning 4 out of 5 stars for safety and soundness. Here's an analysis of how the credit union faired on the three key criteria Bankrate used to grade American credit unions.

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THE INSTITUTION'S SCORE

Capital Score

Capital is an important measurement of an institution's financial strength. It works as a bulwark against losses and affords protection for members during times of financial trouble for the credit union. From a safety and soundness perspective, the higher the capital, the better.

NORTH EAST WELCH scored above the national average of 15.65 points on our test to measure capital adequacy, achieving a score of 20 out of a possible 30 points.

NORTH EAST WELCH had a capitalization ratio of 20.00 percent in our test, above the average for all credit unions, a sign that it's on more solid financial footing than its peers.

Asset Quality Score

This test is intended to estimate how the credit union's capitalization and allocated loan loss reserves could be affected by problem assets, such as past-due loans.

A credit union with large numbers of these types of assets could eventually have to use capital to absorb losses, diminishing its cushion of equity. Many of those assets are also likely to be in non-accrual status and thus aren't earning money, resulting in reduced earnings and potentially more risk of a failure in the future.

NORTH EAST WELCH scored 36 out of a possible 40 points on Bankrate's asset quality test, less than the national average of 38.09.

The credit union's ratio of problem assets was 0.00 percent in our test, less than the national average and potentially indicative of greater financial strength than other credit unions.

Earnings score

A credit union's earnings performance affects its long-term survivability. Earnings can be retained by the credit union, boosting its capital cushion, or be used to address problematic loans, likely making the credit union better able to withstand financial shocks. Losses, on the other hand, lessen a credit union's ability to do those things.

On Bankrate's earnings test, NORTH EAST WELCH scored 8 out of a possible 30, falling short of the national average of 10.11.

One sign 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.