Safe and Sound

PRINCETON

Princeton, NJ
4
Star Rating
Princeton, NJ-based PRINCETON is an NCUA-insured credit union started in 1972. Regulatory filings show the credit union having assets of $137.5 million, as of December 31, 2017.

Thanks to the work of 21 full-time employees, the credit union holds loans and leases worth $64.2 million. Its 7,974 members currently have $123.3 million in shares with the credit union.

Overall, Bankrate believes that, as of December 31, 2017, PRINCETON exhibited a good condition, earning 4 out of 5 stars for safety and soundness. Keep reading for a look at how the credit union faired on the three major criteria Bankrate used to score American credit unions.

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THE INSTITUTION'S SCORE

Capital Score

When it comes to measuring a credit union's financial resilience, capital is essential. It works as a cushion against losses and as protection for members during times of financial trouble for the credit union. From a safety and soundness perspective, more capital is preferred.

PRINCETON fell below the national average of 15.65 on our test to measure the adequacy of a credit union's capital, receiving a score of 12 out of a possible 30 points.

PRINCETON had a capitalization ratio of 12.00 percent in our test, less than the average for all credit unions, an indication that it could be less resilient in a crisis than its peers.

Asset Quality Score

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

Having a large number of these types of assets means a credit union could eventually have to use capital to cover losses, decreasing its equity buffer. Many of those assets are also likely to be in non-accrual status and thus aren't earning interest for the credit union, resulting in reduced earnings and potentially more risk of a future failure.

PRINCETON scored above 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 problem 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 earning money has an effect on its safety and soundness. Earnings may be retained by the credit union, giving a boost to its capital cushion, or be used to address problematic loans, potentially making the credit union better able to withstand financial trouble. Losses, on the other hand, lessen a credit union's ability to do those things.

PRINCETON scored 4 out of a possible 30 on Bankrate's test of earnings, below the national average of 10.11.

One sign that PRINCETON is outperforming its peers in this area was its earnings ratio of 0.00 percent in our test, higher than 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.