Safe and Sound

P.S. LOCAL 821

Jersey City, NJ
3
Star Rating
Started in 1954, P.S. LOCAL 821 is an NCUA-insured credit union headquartered in Jersey City, NJ. As of December 31, 2017, the credit union held assets of $890,450.

The credit union has amassed loans and leases worth $231,673. P.S. LOCAL 821's 226 members currently have $704,622 in shares with the credit union.

Overall, Bankrate believes that, as of December 31, 2017, P.S. LOCAL 821 exhibited a generally satisfactory condition, earning 3 out of 5 stars for safety and soundness. Here's a breakdown of how the credit union faired on the three major criteria Bankrate used to grade American credit unions.

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SAFE AND SOUND?

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THE INSTITUTION'S SCORE

Capital Score

Capital works as a buffer against losses and as protection for members when a credit union is struggling financially. It follows then that when it comes to measuring an a credit union's financial fortitude, capital is important. When looking at safety and soundness, more capital is preferred.

P.S. LOCAL 821 exceeded the national average of 15.65 points on our test to measure the adequacy of a credit union's capital, achieving a score of 30 out of a possible 30 points.

P.S. LOCAL 821 had a capitalization ratio of 30.00 percent in our test, higher than the average for all credit unions, suggesting that it could have an easier time weathering financial trouble than its peers.

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 loans.

A credit union with extensive holdings of these types of assets could eventually be required to use capital to cover 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 money, diminishing earnings and elevating the chances of a failure in the future.

P.S. LOCAL 821 scored above the national average of 38.09 on Bankrate's test of asset quality, racking up 40 out of a possible 40 points .

A lower-than-average ratio of troubled assets of 0.00 percent in our test was potentially indicative of greater financial strength than other credit unions.

Earnings score

How successful a credit union is at earning money has an effect on its safety and soundness. Earnings may be retained by the credit union, boosting its capital buffer, or be used to deal with problematic loans, potentially making the credit union more resilient in tough times. Conversely, losses diminish a credit union's ability to do those things.

On Bankrate's earnings test, P.S. LOCAL 821 scored 0 out of a possible 30, lower than the national average of 10.11.

P.S. LOCAL 821 had an earnings ratio of 0.00 percent in our test, above the average for all credit unions, suggesting that it's beating 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.