Safe and Sound

PASADENA MUNICIPAL

Pasadena, TX
5
Star Rating
Pasadena, TX-based PASADENA MUNICIPAL is an NCUA-insured credit union started in 1954. As of December 31, 2017, the credit union had assets of $12.7 million.

Its 1,489 members currently have $10.4 million in shares with the credit union. With that footprint, the credit union holds loans and leases worth $5.1 million.

Overall, Bankrate believes that, as of December 31, 2017, PASADENA MUNICIPAL exhibited a superior condition, earning a full 5 stars for safety and soundness. Keep reading for a look at how the credit union faired on the three important criteria Bankrate used to grade U.S. credit unions on safety and soundness.

WHAT IS
SAFE AND SOUND?

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THE INSTITUTION'S SCORE

Capital Score

Capital is an important measurement of a credit union's financial fortitude. It works as a bulwark against losses and provides protection for members when a credit union is experiencing financial trouble. When looking at safety and soundness, the more capital, the better.

PASADENA MUNICIPAL scored above the national average of 15.65 points on our test to measure the adequacy of a credit union's capital, racking up 26 out of a possible 30 points.

PASADENA MUNICIPAL's capitalization ratio of 26.00 percent in our test was higher than the average for all credit unions, suggesting that it's more well prepared for financial trouble than its peers.

Asset Quality Score

In this test, Bankrate tries to estimate the effect of troubled assets, such as past-due mortgages, on the credit union's loan loss reserves and overall capitalization.

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

PASADENA MUNICIPAL did better than the national average of 38.09 on Bankrate's asset quality test, racking up 40 out of a possible 40 points .

Troubled assets made up 0.00 percent of PASADENA MUNICIPAL's total assets in our test, beneath the national average and potentially indicative of superior financial strength compared to other credit unions.

Earnings score

A credit union's ability to earn money affects its long-term survivability. A credit union can retain its earnings, expanding its capital buffer, or use them to address problematic loans, likely making the credit union better able to withstand financial trouble. Losses, on the other hand, take away from a credit union's ability to do those things.

PASADENA MUNICIPAL scored 4 out of a possible 30 on Bankrate's earnings test, below the national average of 10.11.

One sign that the credit union is outperforming 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.