Safe and Sound

TXDOT

Abilene, TX
4
Star Rating
Started in 1971, TXDOT is an NCUA-insured credit union headquartered in Abilene, TX. The credit union has assets of $12.6 million, according to December 31, 2017, regulatory filings.

Thanks to the work of 2 full-time employees, the credit union has amassed loans and leases worth $10.9 million. Its 1,280 members currently have $11.0 million in shares with the credit union.

Overall, Bankrate believes that, as of December 31, 2017, TXDOT exhibited a good condition, earning 4 out of 5 stars for safety and soundness. Keep reading for a breakdown of how the credit union faired on the three major criteria Bankrate used to score U.S. credit unions.

WHAT IS
SAFE AND SOUND?

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THE INSTITUTION'S SCORE

Capital Score

Capital works as a buffer against losses and as protection for members during times of economic trouble for the credit union. It follows then that when it comes to measuring an an institution's financial stability, capital is important. From a safety and soundness perspective, the more capital, the better.

TXDOT achieved a score of 16 out of a possible 30 points on our test to measure the adequacy of a credit union's capital, exceeding the national average of 15.65.

TXDOT had a capitalization ratio of 16.00 percent in our test, identical the average for all credit unions, a sign that it's right in line with its peers.

Asset Quality Score

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

A credit union with a large number of these kinds of assets may eventually be forced to use capital to absorb losses, decreasing its cushion of equity. Many of those assets are also likely to be in non-accrual status and thus aren't earning money, pushing down earnings and increasing the risk of a future failure.

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

A below-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

How successful a credit union is at making money has an effect on its safety and soundness. Earnings may be retained by the credit union, boosting its capital cushion, or be used to address problematic loans, potentially making the credit union better prepared to withstand economic trouble. Conversely, losses reduce a credit union's ability to do those things.

TXDOT received above-average marks on Bankrate's test of earnings, achieving a score of 12 out of a possible 30.

One indication that TXDOT is beating its peers in this area was its earnings ratio of 0.00 percent in our test, higher 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.