Safe and Sound

VALLEY FCU OF MONTANA

BILLINGS, MT
5
Star Rating
BILLINGS, MT-based VALLEY FCU OF MONTANA is an NCUA-insured credit union founded in 1949. The credit union has assets of $244.0 million, according to December 31, 2017, regulatory filings.

Members have $193.2 million on deposit tended by 86 full-time employees. With that footprint, the credit union has amassed loans and leases worth $193.2 million. Its 28,180 members currently have $212.7 million in shares with the credit union.

Overall, Bankrate believes that, as of December 31, 2017, VALLEY FCU OF MONTANA exhibited a superior condition, earning a full 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 on safety and soundness.

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THE INSTITUTION'S SCORE

Capital Score

When it comes to measuring an institution's financial stability, capital is key. It works as a bulwark against losses and as protection for members when a credit union is struggling financially. When looking at safety and soundness, more capital is preferred.

VALLEY FCU OF MONTANA received a score of 14 out of a possible 30 points on our test to measure capital adequacy, falling short of the national average of 15.65.

VALLEY FCU OF MONTANA appears to be less well prepared for financial trouble than its peers in this area, with a capitalization ratio of 14.00 percent in our test, less than the average for all credit unions.

Asset Quality Score

This test is intended to try to understand how the credit union's reserves set aside to cover loan losses, as well as overall capitalization could be affected by problem assets, such as unpaid mortgages.

A credit union with lots of these kinds of assets may eventually have to use capital to absorb losses, diminishing its cushion of equity. It also means that there are likely to be many assets that are in non-accrual status and thus aren't earning interest for the credit union, resulting in lower earnings and potentially more risk of a failure in the future.

VALLEY FCU OF MONTANA scored 40 out of a possible 40 points on Bankrate's asset quality test, exceeding the national average of 38.09.

The credit union's ratio of problem assets was 0.00 percent in our test, lower than the national average and suggestive of superior financial strength compared to other credit unions.

Earnings score

A credit union's ability to earn money affects its long-term survivability. A credit union can retain its earnings, expanding its capital buffer, or use them to deal with problematic loans, potentially making the credit union better able to withstand economic shocks. Conversely, losses diminish a credit union's ability to do those things.

VALLEY FCU OF MONTANA received above-average marks on Bankrate's earnings test, achieving a score of 18 out of a possible 30.

One indication that VALLEY FCU OF MONTANA is outperforming 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.