Safe and Sound

TELCOE

LITTLE ROCK, AR
5
Star Rating
TELCOE is a LITTLE ROCK, AR-based, NCUA-insured credit union started in 1950. Regulatory filings show the credit union having $353.5 million in assets, as of December 31, 2017.

Members have $104.1 million on deposit tended by 32 full-time employees. With that footprint, the credit union currently holds loans and leases worth $104.1 million. Its 24,527 members currently have $268.4 million in shares with the credit union.

Overall, Bankrate believes that, as of December 31, 2017, TELCOE exhibited a superior condition, earning a full 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 score American credit unions on safety and soundness.

WHAT IS
SAFE AND SOUND?

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THE INSTITUTION'S SCORE

Capital Score

Capital is an essential measurement of an institution's financial strength. It works as a cushion against losses and provides protection for members when a credit union is experiencing economic instability. When it comes to safety and soundness, the higher the capital, the better.

TELCOE achieved a score of 30 out of a possible 30 points on our test to measure capital adequacy, beating out the national average of 15.65.

TELCOE had a capitalization ratio of 30.00 percent in our test, higher than the average for all credit unions, an indication that it's on more solid financial footing than its peers.

Asset Quality Score

Bankrate uses this test to determine the impact of troubled assets, such as past-due mortgages, on the credit union's loan loss reserves and overall capitalization.

A credit union with large numbers of these kinds of assets may eventually be required to use capital to absorb losses, shrinking its equity buffer. Many of those assets are also likely to be in non-accrual status and no longer earning interest for the credit union, resulting in depressed earnings and potentially more risk of a future failure.

On Bankrate's asset quality test, TELCOE scored 40 out of a possible 40 points, better than the national average of 38.09 points.

A below-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 earning money has an effect on its safety and soundness. Earnings may be retained by the credit union, expanding its capital cushion, or be used to address problematic loans, likely making the credit union better able to withstand financial trouble. However, credit unions that are losing money have less ability to do those things.

TELCOE fell short of the national average on Bankrate's earnings test, achieving a score of 6 out of a possible 30.

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 running ahead of 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.