Safe and Sound

PROVIDENCE

MILWAUKIE, OR
4
Star Rating
PROVIDENCE is an NCUA-insured credit union started in 1969 and currently based in MILWAUKIE, OR. The credit union holds $136.5 million in assets, according to December 31, 2017, regulatory filings.

Thanks to the work of 26 full-time employees, the credit union holds loans and leases worth $87.2 million. Its 15,772 members currently have $119.6 million in shares with the credit union.

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

WHAT IS
SAFE AND SOUND?

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THE INSTITUTION'S SCORE

Capital Score

When it comes to measuring a credit union's financial fortitude, capital is useful. It works as a cushion against losses and provides protection for members when a credit union is struggling financially. From a safety and soundness perspective, more capital is preferred.

PROVIDENCE racked up 16 out of a possible 30 points on our test to measure the adequacy of a credit union's capital, beating the national average of 15.65.

PROVIDENCE's capitalization ratio of 16.00 percent in our test puts it right in line with the average for all credit unions.

Asset Quality Score

Bankrate uses this test to determine the effect of troubled assets, such as past-due mortgages, on the credit union's capitalization and allocated loan loss reserves.

A credit union with a large number of these kinds of assets may eventually have to use capital to cover losses, decreasing 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 future failure.

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

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

Earnings score

A credit union's earnings performance affects its long-term survivability. Earnings may be retained by the credit union, giving a boost to its capital cushion, or be used to deal with problematic loans, potentially making the credit union more resilient in times of trouble. Credit unions that are losing money, however, are less able to do those things.

PROVIDENCE outperformed the average on Bankrate's earnings test, achieving a score of 12 out of a possible 30.

PROVIDENCE had an earnings ratio of 0.00 percent in our test, above the average for all credit unions, an indication that it's outperforming 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.