Safe and Sound

PASSAIC POLICE

PASSAIC, NJ
5
Star Rating
PASSAIC, NJ-based PASSAIC POLICE is an NCUA-insured credit union founded in 1958. The credit union has assets of $6.5 million, according to December 31, 2017, regulatory filings.

PASSAIC POLICE's 618 members currently have $5.6 million in shares with the credit union. With that footprint, the credit union holds loans and leases worth $1.8 million.

Overall, Bankrate believes that, as of December 31, 2017, PASSAIC POLICE exhibited a superior condition, earning a full 5 stars for safety and soundness. Here's a look at how the credit union did on the three major criteria Bankrate used to evaluate U.S. credit unions on safety and soundness.

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 as protection for members during periods of economic instability for the credit union. When looking at safety and soundness, the higher the capital, the better.

PASSAIC POLICE scored 20 out of a possible 30 points on our test to measure the adequacy of a credit union's capital, exceeding the national average of 15.65.

PASSAIC POLICE's capitalization ratio of 20.00 percent in our test was higher than the average for all credit unions, suggesting that it's stronger than its peers.

Asset Quality Score

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

Having lots of these kinds of assets suggests a credit union could have to use capital to cover losses, shrinking its cushion of equity. Many of those assets are also likely to be in non-accrual status and no longer earning money, resulting in reduced earnings and potentially more risk of a failure in the future.

PASSAIC POLICE beat out the national average of 38.09 on Bankrate's asset quality test, 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 superior financial strength compared to other credit unions.

Earnings score

How successful a credit union is at making money affects its long-term survivability. Earnings can be retained by the credit union, expanding its capital buffer, or be used to deal with problematic loans, likely making the credit union more resilient in tough times. However, credit unions that are losing money are less able to do those things.

On Bankrate's earnings test, PASSAIC POLICE scored 14 out of a possible 30, beating out the national average of 10.11.

The credit union had an earnings ratio of 0.00 percent in our test, better than the average for all credit unions, a sign that it's running ahead of 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.