Safe and Sound

PREMIER SOURCE

East Longmeadow, MA
3
Star Rating
PREMIER SOURCE is an East Longmeadow, MA-based, NCUA-insured credit union founded in 1941. As of December 31, 2017, the credit union had assets of $64.3 million.

With 20 full-time employees, the credit union currently holds loans and leases worth $35.8 million. Its 5,148 members currently have $55.8 million in shares with the credit union.

Overall, Bankrate believes that, as of December 31, 2017, PREMIER SOURCE exhibited a generally satisfactory condition, earning 3 out of 5 stars for safety and soundness. Here's a breakdown of how the credit union faired on the three key criteria Bankrate used to grade U.S. credit unions.

WHAT IS
SAFE AND SOUND?

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THE INSTITUTION'S SCORE

Capital Score

Capital works 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 an institution's financial fortitude, capital is essential. From a safety and soundness perspective, the more capital, the better.

PREMIER SOURCE did better than the national average of 15.65 points on our test to measure the adequacy of a credit union's capital, scoring 18 out of a possible 30 points.

PREMIER SOURCE had a capitalization ratio of 18.00 percent in our test, above the average for all credit unions, suggesting that it's stronger than its peers.

Asset Quality Score

In this test, Bankrate tries to determine the effect of troubled assets, such as past-due loans, 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, decreasing its cushion of equity. Many of those assets are also likely to be in non-accrual status and thus aren't earning money, resulting in reduced earnings and potentially more risk of a failure in the future.

PREMIER SOURCE scored 36 out of a possible 40 points on Bankrate's asset quality test, failing to reach the national average of 38.09.

A lower-than-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 profitability has an effect on its safety and soundness. Earnings can be retained by the credit union, giving a boost to its capital buffer, or be used to deal with problematic loans, likely making the credit union more resilient in tough times. Conversely, losses diminish a credit union's ability to do those things.

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

One indication that PREMIER SOURCE is running ahead of 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.