Safe and Sound

SOUTH TEXAS REGIONAL

Laredo, TX
1
Star Rating
Laredo, TX-based SOUTH TEXAS REGIONAL is an NCUA-insured credit union started in 1950. As of December 31, 2017, the credit union had assets of $6.8 million.

With 3 full-time employees, the credit union has amassed loans and leases worth $5.0 million. Its 1,251 members currently have $6.3 million in shares with the credit union.

Overall, Bankrate believes that, as of December 31, 2017, SOUTH TEXAS REGIONAL exhibited a significantly below-average condition, earning 1 out of 5 stars for safety and soundness. Keep reading for a look at how the credit union did on the three major criteria Bankrate used to score U.S. credit unions.

WHAT IS
SAFE AND SOUND?

Find out

THE INSTITUTION'S SCORE

Capital Score

Capital is an essential measurement of an institution's financial fortitude. It acts as a bulwark against losses and affords protection for members when a credit union is experiencing financial trouble. When it comes to safety and soundness, the more capital, the better.

On our test to measure capital adequacy, SOUTH TEXAS REGIONAL received a score of 6 out of a possible 30 points, coming in below the national average of 15.65.

SOUTH TEXAS REGIONAL had a capitalization ratio of 6.00 percent in our test, less than the average for all credit unions, a sign that it's less well prepared for financial trouble than its peers.

Asset Quality Score

This test's purpose is to try to understand how the credit union's loan loss reserves and overall capitalization could be affected by problem assets, such as unpaid loans.

A credit union with a large number of these types of assets may eventually have to use capital to cover losses, diminishing 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 reduced earnings and potentially more risk of a future failure.

On Bankrate's asset quality test, SOUTH TEXAS REGIONAL scored 32 out of a possible 40 points, falling short of the national average of 38.09 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

How successful a credit union is at making money affects its long-term survivability. Earnings can be retained by the credit union, increasing its capital buffer, or be used to deal with problematic loans, likely making the credit union more resilient in times of trouble. Credit unions that are losing money, however, have less ability to do those things.

On Bankrate's earnings test, SOUTH TEXAS REGIONAL scored 0 out of a possible 30, below the national average of 10.11.

The credit union had an earnings ratio of 0.00 percent in our test, higher than 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.