Safe and Sound

TIMBERLINE

CROSSETT, AR
4
Star Rating
TIMBERLINE is a CROSSETT, AR-based, NCUA-insured credit union dating back to 1957. The credit union holds assets of $76.5 million, according to December 31, 2017, regulatory filings.

With 34 full-time employees, the credit union has amassed loans and leases worth $39.1 million. Its 9,310 members currently have $61.8 million in shares with the credit union.

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

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 resilience. It acts as a buffer against losses and affords protection for members when a credit union is struggling financially. When it comes to safety and soundness, the higher the capital, the better.

On our test to measure capital adequacy, TIMBERLINE scored 28 out of a possible 30 points, above the national average of 15.65.

TIMBERLINE appears to be more well prepared for financial trouble than its peers, with a capitalization ratio of 28.00 percent in our test, above the average for all credit unions.

Asset Quality Score

Bankrate uses this test to estimate the impact of troubled assets, such as unpaid mortgages, on the credit union's reserves set aside to cover loan losses, as well as overall capitalization.

A credit union with a large number of these types of assets could eventually be required to use capital to cover 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 lower earnings and potentially more risk of a future failure.

TIMBERLINE beat out the national average of 38.09 on Bankrate's asset quality test, racking up 40 out of a possible 40 points .

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, increasing its capital cushion, or put them to work addressing problematic loans, likely making the credit union better able to withstand financial trouble. However, credit unions that are losing money are less able to do those things.

On Bankrate's earnings test, TIMBERLINE scored 0 out of a possible 30, less than the national average of 10.11.

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.