Safe and Sound

T E A

HOUMA, LA
3
Star Rating
T E A is a HOUMA, LA-based, NCUA-insured credit union started in 1967. Regulatory filings show the credit union having $2.2 million in assets, as of December 31, 2017.

The credit union currently holds loans and leases worth $1.1 million. T E A's 776 members currently have $2.0 million in shares with the credit union.

Overall, Bankrate believes that, as of December 31, 2017, T E A exhibited a generally satisfactory condition, earning 3 out of 5 stars for safety and soundness. Keep reading for a breakdown of how the credit union did on the three important criteria Bankrate used to evaluate American credit unions.

WHAT IS
SAFE AND SOUND?

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THE INSTITUTION'S SCORE

Capital Score

Capital works as a bulwark against losses and as protection for members during periods of financial instability for the credit union. It follows then that a credit union's level of capital is a useful measurement of its financial fortitude. From a safety and soundness perspective, the more capital, the better.

T E A received a score of 8 out of a possible 30 points on our test to measure capital adequacy, below the national average of 15.65.

T E A appears to be weaker than its peers in this area, with a capitalization ratio of 8.00 percent in our test, less than the average for all credit unions.

Asset Quality Score

In this test, Bankrate tries to determine the effect of troubled assets, such as past-due loans, on the credit union's capitalization and allocated loan loss reserves.

Having large numbers of these kinds of assets means a credit union could have to use capital to absorb losses, decreasing its cushion of equity. Many of those assets are also likely to be in non-accrual status and no longer earning money, pushing down earnings and elevating the chances of a future failure.

T E A scored 32 out of a possible 40 points on Bankrate's test of asset quality, coming in below the national average of 38.09.

A lower-than-average ratio of problem assets of 0.00 percent in our test was potentially indicative of superior financial strength compared to other credit unions.

Earnings score

A credit union's profitability has an effect on its safety and soundness. A credit union can retain its earnings, expanding its capital cushion, or put them to work addressing problematic loans, likely making the credit union better able to withstand economic shocks. Conversely, losses reduce a credit union's ability to do those things.

T E A exceeded the national average on Bankrate's earnings test, achieving a score of 12 out of a possible 30.

One indication that the credit union is running ahead of its peers in this area was its earnings ratio of 0.00 percent in our test, better than the average for all credit unions.

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.