Safe and Sound

PAWTUCKET

PAWTUCKET, RI
4
Star Rating
PAWTUCKET, RI-based PAWTUCKET is an NCUA-insured credit union founded in 1926. Regulatory filings show the credit union having $2.13 billion in assets, as of December 31, 2017.

With 253 full-time employees, the credit union currently holds loans and leases worth $1.87 billion. PAWTUCKET's 108,212 members currently have $1.67 billion in shares with the credit union.

Overall, Bankrate believes that, as of December 31, 2017, PAWTUCKET exhibited a good condition, earning 4 out of 5 stars for safety and soundness. Keep reading for a breakdown of how the credit union did on the three important criteria Bankrate used to grade American credit unions.

WHAT IS
SAFE AND SOUND?

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THE INSTITUTION'S SCORE

Capital Score

Capital acts as a bulwark against losses and provides 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 key. From a safety and soundness perspective, more capital is preferred.

PAWTUCKET received a score of 10 out of a possible 30 points on our test to measure capital adequacy, lower than the national average of 15.65.

PAWTUCKET had a capitalization ratio of 10.00 percent in our test, worse than the average for all credit unions, a sign that it could be less resilient in a crisis than its peers.

Asset Quality Score

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

Having extensive holdings of these types of assets suggests a credit union could have to use capital to cover losses, reducing its equity buffer. It also means that there are likely to be many assets that are in non-accrual status and no longer earning money, decreasing earnings and increasing the chances of a failure in the future.

On Bankrate's asset quality test, PAWTUCKET scored 40 out of a possible 40 points, better than the national average of 38.09 points.

The credit union's ratio of troubled assets was 0.00 percent in our test, beneath the national average and suggestive of greater financial strength than other credit unions.

Earnings score

A credit union's ability to earn money has an effect on its safety and soundness. A credit union can retain its earnings, boosting its capital cushion, or use them to deal with problematic loans, likely making the credit union more resilient in times of trouble. Credit unions that are losing money, however, are less able to do those things.

On Bankrate's test of earnings, PAWTUCKET scored 16 out of a possible 30, exceeding the national average of 10.11.

The credit union had an earnings ratio of 0.00 percent in our test, above the average for all credit unions, an indication 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.