Safe and Sound

PARKER COMMUNITY

JANESVILLE, WI
2
Star Rating
JANESVILLE, WI-based PARKER COMMUNITY is an NCUA-insured credit union started in 1934. The credit union holds assets of $124.2 million, according to June 30, 2017, regulatory filings.

With 20 full-time employees, the credit union holds loans and leases worth $95.9 million. PARKER COMMUNITY's 16,520 members currently have $111.5 million in shares with the credit union.

Overall, Bankrate believes that, as of June 30, 2017, PARKER COMMUNITY exhibited a generally satisfactory condition, earning 3 out of 5 stars for safety and soundness. Keep reading for a look at how the credit union did on the three key criteria Bankrate used to grade American 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 resilience, capital is important. It acts as a buffer against losses and as protection for members during periods of financial trouble for the credit union. From a safety and soundness perspective, more capital is better.

PARKER COMMUNITY received a score of 4 out of a possible 30 points on our test to measure the adequacy of a credit union's capital, failing to reach the national average of 15.26.

PARKER COMMUNITY's capitalization ratio of 7.00 percent in our test was less than the average for all credit unions, an indication that it could have a harder time weathering financial trouble than its peers.

Asset Quality Score

This test's purpose is to try to understand how the credit union's loan loss reserves and overall capitalization could be affected by troubled assets, such as past-due loans.

A credit union with lots of these types of assets may eventually be forced to use capital to cover losses, decreasing its equity buffer. 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 elevating the chances of a future failure.

On Bankrate's asset quality test, PARKER COMMUNITY scored 36 out of a possible 40 points, less than the national average of 38.15 points.

A higher-than-average ratio of problem assets of 10.00 percent in our test was a potential cause for concern for the credit union.

Earnings score

A credit union's ability to earn money has an effect on its safety and soundness. Earnings can be retained by the credit union, giving a boost to its capital buffer, or be used to deal with problematic loans, likely making the credit union better prepared to withstand financial shocks. Obviously, credit unions that are losing money have less ability to do those things.

PARKER COMMUNITY received below-average marks on Bankrate's earnings test, achieving a score of 6 out of a possible 30.

PARKER COMMUNITY had an earnings ratio of 3.00 percent in our test, above the average for all credit unions, a sign that it's outperforming 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.