Safe and Sound

TAHQUAMENON AREA

NEWBERRY, MI
4
Star Rating
TAHQUAMENON AREA is an NCUA-insured credit union started in 1955 and currently headquartered in NEWBERRY, MI. As of December 31, 2017, the credit union had assets of $60.1 million.

With 25 full-time employees, the credit union has amassed loans and leases worth $22.0 million. TAHQUAMENON AREA's 6,176 members currently have $53.2 million in shares with the credit union.

Overall, Bankrate believes that, as of December 31, 2017, TAHQUAMENON AREA 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 American credit unions.

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THE INSTITUTION'S SCORE

Capital Score

Capital is an essential measurement of a credit union's financial fortitude. It works as a cushion against losses and as protection for members when a credit union is struggling financially. When looking at safety and soundness, more capital is preferred.

TAHQUAMENON AREA fell below the national average of 15.65 on our test to measure the adequacy of a credit union's capital, achieving a score of 10 out of a possible 30 points.

TAHQUAMENON AREA appears to be less well prepared for financial trouble than its peers in this area, with a capitalization ratio of 10.00 percent in our test, lower than the average for all credit unions.

Asset Quality Score

This test is intended to estimate how the credit union's reserves set aside to cover loan losses, as well as overall capitalization could be affected by problem assets, such as unpaid mortgages.

A credit union with a large number of these types of assets may eventually 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 thus aren't earning interest for the credit union, resulting in diminished earnings and potentially more risk of a failure in the future.

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

Troubled assets made up 0.00 percent of the credit union's total assets in our test, beneath the national average and potentially indicative of superior financial strength compared to other credit unions.

Earnings score

A credit union's earnings performance has an effect on its safety and soundness. A credit union can retain its earnings, expanding its capital buffer, or use them to deal with problematic loans, likely making the credit union better prepared to withstand financial trouble. Conversely, losses diminish a credit union's ability to do those things.

On Bankrate's earnings test, TAHQUAMENON AREA scored 6 out of a possible 30, lower than the national average of 10.11.

One indication that TAHQUAMENON AREA is beating its peers in this area was its earnings ratio of 0.00 percent in our test, above 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.