Safe and Sound

RED ROCKS

LITTLETON, CO
4
Star Rating
LITTLETON, CO-based RED ROCKS is an NCUA-insured credit union founded in 1979. As of December 31, 2017, the credit union held assets of $301.4 million.

With 54 full-time employees, the credit union currently holds loans and leases worth $254.1 million. Its 18,438 members currently have $271.6 million in shares with the credit union.

Overall, Bankrate believes that, as of December 31, 2017, RED ROCKS exhibited a good condition, earning 4 out of 5 stars for safety and soundness. Here's an analysis of how the credit union faired on the three key criteria Bankrate used to grade American credit unions.

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THE INSTITUTION'S SCORE

Capital Score

Capital acts as a cushion against losses and provides protection for members when a credit union is struggling financially. It follows then that when it comes to measuring an a credit union's financial resilience, capital is valuable. When looking at safety and soundness, the higher the capital, the better.

RED ROCKS received a score of 10 out of a possible 30 points on our test to measure the adequacy of a credit union's capital, coming in below the national average of 15.65.

RED ROCKS appears to be on less solid financial footing than its peers in this area, with a capitalization ratio of 10.00 percent in our test, lower than the average for all credit unions.

Asset Quality Score

Bankrate uses this test to estimate the effect of troubled assets, such as unpaid mortgages, on the credit union's reserves set aside to cover loan losses, as well as overall capitalization.

Having lots of these kinds of assets may eventually force a credit union to use capital to cover losses, cutting down on its equity buffer. It also means that there are likely to be many assets that are in non-accrual status and thus aren't earning money, resulting in diminished earnings and potentially more risk of a failure in the future.

RED ROCKS did better than the national average of 38.09 on Bankrate's asset quality test, racking up 40 out of a possible 40 points .

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 affects its long-term survivability. Earnings can be retained by the credit union, boosting its capital buffer, or be used to address problematic loans, potentially making the credit union more resilient in tough times. Obviously, credit unions that are losing money have less ability to do those things.

RED ROCKS received above-average marks on Bankrate's test of earnings, achieving a score of 16 out of a possible 30.

The credit union had an earnings ratio of 0.00 percent in our test, better than the average for all credit unions, an indication that it's running ahead of 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.