Safe and Sound

PINNACLE

EDISON, NJ
1
Star Rating
Started in 1962, PINNACLE is an NCUA-insured credit union based in EDISON, NJ. As of December 31, 2017, the credit union had assets of $129.3 million.

Members have $93.6 million on deposit tended by 21 full-time employees. With that footprint, the credit union currently holds loans and leases worth $93.6 million. Its 14,823 members currently have $108.7 million in shares with the credit union.

Overall, Bankrate believes that, as of December 31, 2017, PINNACLE exhibited a significantly below-average condition, earning 1 out of 5 stars for safety and soundness. Here's an analysis of how the credit union faired on the three major criteria Bankrate used to evaluate U.S. credit unions.

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THE INSTITUTION'S SCORE

Capital Score

Capital is a useful measurement of an institution's financial fortitude. It works as a cushion against losses and affords protection for members during periods of financial trouble for the credit union. When looking at safety and soundness, the more capital, the better.

PINNACLE finished below the national average of 15.65 on our test to measure the adequacy of a credit union's capital, receiving a score of 4 out of a possible 30 points.

PINNACLE had a capitalization ratio of 4.00 percent in our test, below the average for all credit unions, an indication that it's weaker than its peers.

Asset Quality Score

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

A credit union with extensive holdings of these types of assets could eventually have to use capital to cover losses, cutting down on its buffer of equity. It also means that there are likely to be many assets that are in non-accrual status and thus aren't earning interest for the credit union, diminishing earnings and increasing the risk of a future failure.

PINNACLE scored 28 out of a possible 40 points on Bankrate's asset quality test, less than the national average of 38.09.

A below-average ratio of problem 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 profitability affects its long-term survivability. Earnings can be retained by the credit union, expanding its capital cushion, or be used to address problematic loans, potentially making the credit union better able to withstand economic shocks. Conversely, losses reduce a credit union's ability to do those things.

PINNACLE scored 0 out of a possible 30 on Bankrate's test of earnings, failing to reach the national average of 10.11.

One sign that PINNACLE is outperforming 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.