Safe and Sound

TEXAS BAY

HOUSTON, TX
4
Star Rating
TEXAS BAY is an NCUA-insured credit union founded in 1936 and currently headquartered in HOUSTON, TX. The credit union has assets of $438.2 million, according to December 31, 2017, regulatory filings.

With 127 full-time employees, the credit union holds loans and leases worth $355.7 million. TEXAS BAY's 41,163 members currently have $311.5 million in shares with the credit union.

Overall, Bankrate believes that, as of December 31, 2017, TEXAS BAY exhibited a good condition, earning 4 out of 5 stars for safety and soundness. Here's an analysis of how the credit union did on the three major criteria Bankrate used to score American credit unions.

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THE INSTITUTION'S SCORE

Capital Score

When it comes to measuring a credit union's financial fortitude, capital is crucial. It acts as a cushion against losses and affords protection for members when a credit union is experiencing financial trouble. From a safety and soundness perspective, the more capital, the better.

TEXAS BAY received a score of 12 out of a possible 30 points on our test to measure the adequacy of a credit union's capital, falling short of the national average of 15.65.

TEXAS BAY had a capitalization ratio of 12.00 percent in our test, worse than the average for all credit unions, suggesting that it's weaker than its peers.

Asset Quality Score

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

Having a large number of these kinds of assets may eventually force a credit union to use capital to cover losses, decreasing its equity cushion. It also means that there are likely to be many assets that are in non-accrual status and no longer 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, TEXAS BAY scored 32 out of a possible 40 points, failing to reach the national average of 38.09 points.

TEXAS BAY's ratio of troubled assets was 0.00 percent in our test, lower than the national average and suggestive of greater financial strength than other credit unions.

Earnings score

How successful a credit union is at making money has an effect on its long-term survivability. Earnings can be retained by the credit union, boosting its capital cushion, or be used to address problematic loans, likely making the credit union better prepared to withstand financial trouble. Obviously, credit unions that are losing money have less ability to do those things.

TEXAS BAY outperformed the average on Bankrate's earnings test, achieving a score of 18 out of a possible 30.

One indication that the credit union is outperforming 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.