Safe and Sound

SERVICE

PORTSMOUTH, NH
4
Star Rating
SERVICE is a PORTSMOUTH, NH-based, NCUA-insured credit union that opened its doors in 1957. Regulatory filings show the credit union having $3.25 billion in assets, as of December 31, 2017.

Thanks to the efforts of 630 full-time employees, the credit union has amassed loans and leases worth $2.75 billion. SERVICE's 234,863 members currently have $2.63 billion in shares with the credit union.

Overall, Bankrate believes that, as of December 31, 2017, SERVICE exhibited a good condition, earning 4 out of 5 stars for safety and soundness. Keep reading for an analysis of how the credit union faired on the three key criteria Bankrate used to evaluate American 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 resilience, capital is essential. It acts as a bulwark against losses and provides protection for members when a credit union is experiencing financial trouble. When it comes to safety and soundness, the more capital, the better.

SERVICE came in below the national average of 15.65 on our test to measure the adequacy of a credit union's capital, achieving a score of 14 out of a possible 30 points.

SERVICE had a capitalization ratio of 14.00 percent in our test, less than the average for all credit unions, an indication that it's on less solid financial footing than its peers.

Asset Quality Score

This test's purpose is to estimate how the credit union's loan loss reserves and overall capitalization could be affected by troubled assets, such as past-due mortgages.

Having extensive holdings of these kinds of assets means a credit union may have to use capital to cover losses, reducing its equity cushion. Many of those assets are also likely to be in non-accrual status and thus aren't earning money, resulting in depressed earnings and potentially more risk of a future failure.

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

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

Earnings score

How successful a credit union is at earning money affects its long-term survivability. A credit union can retain its earnings, increasing its capital cushion, or use them to deal with problematic loans, potentially making the credit union more resilient in times of trouble. Conversely, losses diminish a credit union's ability to do those things.

On Bankrate's earnings test, SERVICE scored 14 out of a possible 30, better than the national average of 10.11.

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 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.