Safe and Sound

SERVICE 1ST

Danville, PA
4
Star Rating
SERVICE 1ST is a Danville, PA-based, NCUA-insured credit union founded in 1975. As of December 31, 2017, the credit union held assets of $337.2 million.

With 85 full-time employees, the credit union currently holds loans and leases worth $293.7 million. Its 29,011 members currently have $301.2 million in shares with the credit union.

Overall, Bankrate believes that, as of December 31, 2017, SERVICE 1ST exhibited a good condition, earning 4 out of 5 stars for safety and soundness. Here's a look at how the credit union did on the three key criteria Bankrate used to score U.S. credit unions.

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THE INSTITUTION'S SCORE

Capital Score

Capital acts as a bulwark against losses and affords protection for members when a credit union is struggling financially. Therefore, when it comes to measuring an a credit union's financial stability, capital is essential. When looking at safety and soundness, more capital is better.

On our test to measure the adequacy of a credit union's capital, SERVICE 1ST received a score of 8 out of a possible 30 points, coming in below the national average of 15.65.

SERVICE 1ST's capitalization ratio of 8.00 percent in our test was below the average for all credit unions, suggesting that it could have a harder time weathering financial trouble than its peers.

Asset Quality Score

Bankrate uses this test to estimate the effect 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 suggests a credit union could eventually have to use capital to absorb losses, shrinking its buffer of equity. Many of those assets are also likely to be in non-accrual status and no longer earning money, diminishing earnings and elevating the chances of a future failure.

SERVICE 1ST scored above the national average of 38.09 on Bankrate's test of asset quality, racking up 40 out of a possible 40 points .

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

Earnings score

A credit union's profitability affects its safety and soundness. Earnings may be retained by the credit union, boosting its capital buffer, or be used to address problematic loans, potentially making the credit union better prepared to withstand economic shocks. Conversely, losses lessen a credit union's ability to do those things.

On Bankrate's test of earnings, SERVICE 1ST scored 20 out of a possible 30, better than the national average of 10.11.

SERVICE 1ST had an earnings ratio of 0.00 percent in our test, higher than the average for all credit unions, suggesting that it's doing better than 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.