Safe and Sound

PBA

PINE BLUFF, AR
5
Star Rating
PBA is a PINE BLUFF, AR-based, NCUA-insured credit union dating back to 1956. The credit union holds $10.3 million in assets, according to December 31, 2017, regulatory filings.

With 2 full-time employees, the credit union holds loans and leases worth $3.7 million. PBA's 983 members currently have $7.1 million in shares with the credit union.

Overall, Bankrate believes that, as of December 31, 2017, PBA exhibited a superior condition, earning a full 5 stars for safety and soundness. Here's a breakdown of how the credit union faired on the three key criteria Bankrate used to score American credit unions on safety and soundness.

WHAT IS
SAFE AND SOUND?

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THE INSTITUTION'S SCORE

Capital Score

Capital acts as a buffer against losses and as protection for members when a credit union is struggling financially. Therefore, an institution's level of capital is an essential measurement of its financial strength. When it comes to safety and soundness, the higher the capital, the better.

PBA beat out the national average of 15.65 points on our test to measure the adequacy of a credit union's capital, scoring 30 out of a possible 30 points.

PBA had a capitalization ratio of 30.00 percent in our test, better than the average for all credit unions, an indication that it's stronger 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 problem assets, such as unpaid loans.

Having extensive holdings of these types of assets suggests a credit union could have to use capital to absorb losses, shrinking 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, resulting in lower earnings and potentially more risk of a failure in the future.

PBA scored 40 out of a possible 40 points on Bankrate's test of asset quality, beating the national average of 38.09.

A below-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

A credit union's ability to earn money has an effect on its long-term survivability. 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 times of trouble. Losses, on the other hand, take away from a credit union's ability to do those things.

PBA fell short of the national average on Bankrate's earnings test, achieving a score of 2 out of a possible 30.

One sign that PBA is doing better than its peers in this area was its earnings ratio of 0.00 percent in our test, above 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.