Safe and Sound

OPP-MICOLAS

OPP, AL
4
Star Rating
OPP, AL-based OPP-MICOLAS is an NCUA-insured credit union started in 1954. Regulatory filings show the credit union having $13.2 million in assets, as of December 31, 2017.

With 4 full-time employees, the credit union has amassed loans and leases worth $4.0 million. Its 1,951 members currently have $9.9 million in shares with the credit union.

Overall, Bankrate believes that, as of December 31, 2017, OPP-MICOLAS 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 key 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 strength, capital is essential. It works as a buffer against losses and as protection for members during periods of economic trouble for the credit union. When it comes to safety and soundness, the more capital, the better.

On our test to measure capital adequacy, OPP-MICOLAS achieved a score of 30 out of a possible 30 points, above the national average of 15.65.

OPP-MICOLAS had a capitalization ratio of 30.00 percent in our test, higher than the average for all credit unions, suggesting that it could be more resilient in a crisis than its peers.

Asset Quality Score

This test is intended to try to understand how the credit union's capitalization and allocated loan loss reserves could be affected by troubled assets, such as unpaid loans.

A credit union with extensive holdings of these types of assets could eventually have to use capital to absorb losses, shrinking its equity buffer. It also means that there are likely to be many assets that are in non-accrual status and thus aren't earning interest for the credit union, decreasing earnings and elevating the chances of a future failure.

OPP-MICOLAS fell short of the national average of 38.09 on Bankrate's asset quality test, racking up 36 out of a possible 40 points .

A below-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 safety and soundness. A credit union can retain its earnings, giving a boost to its capital cushion, or use them to address problematic loans, likely making the credit union better able to withstand financial shocks. Credit unions that are losing money, however, have less ability to do those things.

On Bankrate's test of earnings, OPP-MICOLAS scored 0 out of a possible 30, falling short of the national average of 10.11.

One sign that the credit union is beating 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.