Safe and Sound

SWEETWATER REGIONAL

Sweetwater, TX
5
Star Rating
Sweetwater, TX-based SWEETWATER REGIONAL is an NCUA-insured credit union started in 1956. As of December 31, 2017, the credit union held assets of $9.2 million.

Thanks to the efforts of 3 full-time employees, the credit union has amassed loans and leases worth $3.3 million. SWEETWATER REGIONAL's 1,490 members currently have $7.5 million in shares with the credit union.

Overall, Bankrate believes that, as of December 31, 2017, SWEETWATER REGIONAL exhibited a superior condition, earning a full 5 stars for safety and soundness. Here's a look at how the credit union did on the three major criteria Bankrate used to evaluate American credit unions on safety and soundness.

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THE INSTITUTION'S SCORE

Capital Score

Capital works as a cushion against losses and provides protection for members when a credit union is struggling financially. It follows then that an institution's level of capital is a crucial measurement of its financial strength. From a safety and soundness perspective, more capital is better.

On our test to measure the adequacy of a credit union's capital, SWEETWATER REGIONAL achieved a score of 26 out of a possible 30 points, above the national average of 15.65.

SWEETWATER REGIONAL's capitalization ratio of 26.00 percent in our test was higher than the average for all credit unions, suggesting that it's more well prepared for financial trouble than its peers.

Asset Quality Score

In this test, Bankrate tries to estimate the impact of troubled assets, such as unpaid mortgages, on the credit union's loan loss reserves and overall capitalization.

A credit union with large numbers of these kinds of assets could eventually have to use capital to absorb losses, diminishing its equity cushion. It also means that there are likely to be many assets that are in non-accrual status and thus aren't earning interest for the credit union, resulting in lower earnings and potentially more risk of a failure in the future.

On Bankrate's asset quality test, SWEETWATER REGIONAL scored 40 out of a possible 40 points, exceeding the national average of 38.09 points.

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

Earnings score

How successful a credit union is at making 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, likely making the credit union better prepared to withstand economic trouble. Credit unions that are losing money, however, are less able to do those things.

On Bankrate's earnings test, SWEETWATER REGIONAL scored 10 out of a possible 30, falling short of the national average of 10.11.

The credit union had an earnings ratio of 0.00 percent in our test, above the average for all credit unions, suggesting 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.