Safe and Sound

THE PEOPLE'S

AMARILLO, TX
3
Star Rating
THE PEOPLE'S is an AMARILLO, TX-based, NCUA-insured credit union dating back to 1953. Regulatory filings show the credit union having $180.1 million in assets, as of December 31, 2017.

Thanks to the efforts of 55 full-time employees, the credit union has amassed loans and leases worth $100.8 million. Its 21,051 members currently have $163.9 million in shares with the credit union.

Overall, Bankrate believes that, as of December 31, 2017, THE PEOPLE'S exhibited a generally satisfactory condition, earning 3 out of 5 stars for safety and soundness. Keep reading for a look at how the credit union did on the three important criteria Bankrate used to evaluate U.S. credit unions.

WHAT IS
SAFE AND SOUND?

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THE INSTITUTION'S SCORE

Capital Score

When it comes to measuring an institution's financial resilience, capital is useful. It acts as a cushion against losses and affords protection for members during times of financial trouble for the credit union. From a safety and soundness perspective, the higher the capital, the better.

On our test to measure capital adequacy, THE PEOPLE'S received a score of 8 out of a possible 30 points, lower than the national average of 15.65.

THE PEOPLE'S had a capitalization ratio of 8.00 percent in our test, less than the average for all credit unions, suggesting that it could have a harder time weathering financial trouble than its peers.

Asset Quality Score

This test is intended to estimate how the credit union's capitalization and allocated loan loss reserves could be affected by problem assets, such as past-due mortgages.

A credit union with lots of these kinds of assets could eventually have to use capital to cover losses, decreasing its equity buffer. It also means that there are likely to be many assets that are in non-accrual status and no longer earning money, resulting in lower earnings and potentially more risk of a failure in the future.

On Bankrate's asset quality test, THE PEOPLE'S scored 36 out of a possible 40 points, falling short of the national average of 38.09 points.

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

Earnings score

A credit union's ability to earn money affects its safety and soundness. Earnings can be retained by the credit union, increasing its capital buffer, or be used to address problematic loans, potentially making the credit union more resilient in times of trouble. Credit unions that are losing money, however, have less ability to do those things.

On Bankrate's test of earnings, THE PEOPLE'S scored 4 out of a possible 30, less than the national average of 10.11.

One indication that THE PEOPLE'S is doing better than 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.