Safe and Sound

TVA ALLEN STEAM PLANT

MEMPHIS, TN
4
Star Rating
MEMPHIS, TN-based TVA ALLEN STEAM PLANT is an NCUA-insured credit union started in 1964. Regulatory filings show the credit union having $3.6 million in assets, as of December 31, 2017.

The credit union has amassed loans and leases worth $887,337. TVA ALLEN STEAM PLANT's 263 members currently have $3.1 million in shares with the credit union.

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

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THE INSTITUTION'S SCORE

Capital Score

When it comes to measuring a credit union's financial stability, capital is valuable. It works as a cushion against losses and affords protection for members when a credit union is struggling financially. When it comes to safety and soundness, more capital is preferred.

TVA ALLEN STEAM PLANT exceeded the national average of 15.65 points on our test to measure capital adequacy, achieving a score of 22 out of a possible 30 points.

TVA ALLEN STEAM PLANT had a capitalization ratio of 22.00 percent in our test, better than the average for all credit unions, suggesting that it's stronger than its peers.

Asset Quality Score

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

Having lots of these kinds of assets may eventually require a credit union to use capital to absorb losses, cutting down on 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 failure in the future.

On Bankrate's test of asset quality, TVA ALLEN STEAM PLANT scored 40 out of a possible 40 points, above the national average of 38.09 points.

TVA ALLEN STEAM PLANT's ratio of troubled assets was 0.00 percent in our test, lower than the national average and potentially indicative of greater financial strength than other credit unions.

Earnings score

A credit union's earnings performance has an effect on its safety and soundness. Earnings can be retained by the credit union, increasing its capital buffer, or be used to deal with problematic loans, likely making the credit union more resilient in tough times. Conversely, losses lessen a credit union's ability to do those things.

On Bankrate's test of earnings, TVA ALLEN STEAM PLANT scored 2 out of a possible 30, coming in below the national average of 10.11.

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.