Safe and Sound

UNITY

Oaklyn, NJ
5
Star Rating
Oaklyn, NJ-based UNITY is an NCUA-insured credit union started in 1954. Regulatory filings show the credit union having $3.1 million in assets, as of December 31, 2017.

The credit union currently holds loans and leases worth $1.8 million. Its 840 members currently have $2.5 million in shares with the credit union.

Overall, Bankrate believes that, as of December 31, 2017, UNITY exhibited a superior condition, earning a full 5 stars for safety and soundness. Keep reading for a look at how the credit union faired on the three important criteria Bankrate used to grade U.S. credit unions on safety and soundness.

WHAT IS
SAFE AND SOUND?

Find out

THE INSTITUTION'S SCORE

Capital Score

Capital acts as a cushion against losses and affords protection for members when a credit union is struggling financially. Therefore, when it comes to measuring an an institution's financial stability, capital is key. When it comes to safety and soundness, the more capital, the better.

UNITY exceeded the national average of 15.65 points on our test to measure the adequacy of a credit union's capital, achieving a score of 30 out of a possible 30 points.

UNITY's capitalization ratio of 30.00 percent in our test was above the average for all credit unions, a sign that it's stronger 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 problem assets, such as unpaid loans.

A credit union with extensive holdings of these kinds of assets may eventually be forced to use capital to cover losses, reducing its equity buffer. Many of those assets are also likely to be in non-accrual status and thus aren't earning money, diminishing earnings and increasing the risk of a future failure.

On Bankrate's test of asset quality, UNITY scored 40 out of a possible 40 points, better than the national average of 38.09 points.

Troubled assets made up 0.00 percent of the credit union's total assets in our test, less than the national average and potentially indicative of greater financial strength than 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, boosting its capital buffer, or use them to address problematic loans, potentially making the credit union better prepared to withstand economic trouble. Conversely, losses lessen a credit union's ability to do those things.

UNITY did below-average on Bankrate's earnings test, achieving a score of 6 out of a possible 30.

One indication that the credit union is running ahead of 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.