Safe and Sound

NORTHEAST FAMILY

MANCHESTER, CT
4
Star Rating
Founded in 1938, NORTHEAST FAMILY is an NCUA-insured credit union based in MANCHESTER, CT. As of December 31, 2017, the credit union had assets of $81.9 million.

Thanks to the work of 16 full-time employees, the credit union has amassed loans and leases worth $33.9 million. Its 6,162 members currently have $70.0 million in shares with the credit union.

Overall, Bankrate believes that, as of December 31, 2017, NORTHEAST FAMILY exhibited a good condition, earning 4 out of 5 stars for safety and soundness. Keep reading for a look at how the credit union faired on the three major criteria Bankrate used to grade U.S. credit unions.

WHAT IS
SAFE AND SOUND?

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THE INSTITUTION'S SCORE

Capital Score

When it comes to measuring an institution's financial stability, capital is essential. It acts as a cushion against losses and affords protection for members when a credit union is struggling financially. From a safety and soundness perspective, the more capital, the better.

NORTHEAST FAMILY received a score of 10 out of a possible 30 points on our test to measure capital adequacy, coming in below the national average of 15.65.

NORTHEAST FAMILY appears to be less well prepared for financial trouble than its peers in this area, with a capitalization ratio of 10.00 percent in our test, less than the average for all credit unions.

Asset Quality Score

This test's purpose is to estimate how the credit union's reserves set aside to cover loan losses, as well as overall capitalization could be affected by troubled assets, such as past-due mortgages.

A credit union with extensive holdings of these types of assets could eventually have to use capital to cover losses, cutting down on 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, decreasing earnings and elevating the risk of a future failure.

NORTHEAST FAMILY exceeded the national average of 38.09 on Bankrate's test of asset quality, racking up 40 out of a possible 40 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 long-term survivability. Earnings may be retained by the credit union, expanding its capital buffer, or be used to deal with problematic loans, potentially making the credit union better prepared to withstand financial trouble. Losses, on the other hand, diminish a credit union's ability to do those things.

On Bankrate's test of earnings, NORTHEAST FAMILY scored 8 out of a possible 30, lower than the national average of 10.11.

NORTHEAST FAMILY had an earnings ratio of 0.00 percent in our test, higher than the average for all credit unions, suggesting that it's doing better than 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.