Safe and Sound

TOWANDA SCHOOL EMP.

TOWANDA, PA
4
Star Rating
Founded in 1979, TOWANDA SCHOOL EMP. is an NCUA-insured credit union based in TOWANDA, PA. Regulatory filings show the credit union having $461,556 in assets, as of December 31, 2017.

The credit union has amassed loans and leases worth $170,252. Its 148 members currently have $389,055 in shares with the credit union.

Overall, Bankrate believes that, as of December 31, 2017, TOWANDA SCHOOL EMP. exhibited a good condition, earning 4 out of 5 stars for safety and soundness. Keep reading for a look at how the credit union did on the three major 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 a crucial measurement of an institution's financial fortitude. It works as a bulwark against losses and affords protection for members during times of financial trouble for the credit union. When looking at safety and soundness, the higher the capital, the better.

TOWANDA SCHOOL EMP. did better than the national average of 15.65 points on our test to measure capital adequacy, receiving a score of 22 out of a possible 30 points.

TOWANDA SCHOOL EMP.'s capitalization ratio of 22.00 percent in our test was higher than the average for all credit unions, an indication that it's on more solid financial footing than its peers.

Asset Quality Score

This test's purpose is to try to understand how the credit union's capitalization and allocated loan loss reserves could be affected by troubled assets, such as past-due loans.

A credit union with a large number of these types of assets may eventually be forced to use capital to cover losses, shrinking its buffer of equity. 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 lower earnings and potentially more risk of a future failure.

On Bankrate's asset quality test, TOWANDA SCHOOL EMP. scored 36 out of a possible 40 points, less than the national average of 38.09 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 ability to earn money has an effect on its long-term survivability. A credit union can retain its earnings, increasing its capital cushion, or put them to work addressing problematic loans, potentially making the credit union more resilient in times of trouble. However, credit unions that are losing money have less ability to do those things.

TOWANDA SCHOOL EMP. scored 0 out of a possible 30 on Bankrate's test of earnings, less than the national average of 10.11.

One sign that the credit union is outperforming 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.