Safe and Sound

RELIANCE

King of Prussia, PA
4
Star Rating
RELIANCE is a King of Prussia, PA-based, NCUA-insured credit union dating back to 1940. Regulatory filings show the credit union having $27.8 million in assets, as of December 31, 2017.

Members have $15.3 million on deposit tended by 7 full-time employees. With that footprint, the credit union holds loans and leases worth $15.3 million. RELIANCE's 2,796 members currently have $25.3 million in shares with the credit union.

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

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THE INSTITUTION'S SCORE

Capital Score

Capital is an important measurement of a credit union's financial strength. It works as a buffer against losses and affords protection for members during periods of economic instability for the credit union. When it comes to safety and soundness, more capital is better.

RELIANCE came in below the national average of 15.65 on our test to measure capital adequacy, racking up 8 out of a possible 30 points.

RELIANCE's capitalization ratio of 8.00 percent in our test was less than the average for all credit unions, suggesting that it could be less resilient in a crisis 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 unpaid mortgages.

Having extensive holdings of these kinds of assets means a credit union may have to use capital to cover losses, diminishing its equity cushion. Many of those assets are also likely to be in non-accrual status and no longer earning interest for the credit union, resulting in lower earnings and potentially more risk of a failure in the future.

RELIANCE beat out the national average of 38.09 on Bankrate's test of asset quality, 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 greater financial strength than other credit unions.

Earnings score

A credit union's ability to earn money affects its safety and soundness. Earnings may be retained by the credit union, increasing its capital buffer, or be used to deal with problematic loans, potentially making the credit union better able to withstand financial trouble. Losses, on the other hand, reduce a credit union's ability to do those things.

On Bankrate's earnings test, RELIANCE scored 10 out of a possible 30, below the national average of 10.11.

RELIANCE had an earnings ratio of 0.00 percent in our test, above the average for all credit unions, suggesting that it's beating 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.