Safe and Sound

VATAT

Austin, TX
5
Star Rating
VATAT is an Austin, TX-based, NCUA-insured credit union dating back to 1961. Regulatory filings show the credit union having $7.3 million in assets, as of December 31, 2017.

Members have $6.0 million on deposit tended by 2 full-time employees. With that footprint, the credit union currently holds loans and leases worth $6.0 million. Its 1,150 members currently have $6.0 million in shares with the credit union.

Overall, Bankrate believes that, as of December 31, 2017, VATAT exhibited a superior condition, earning a full 5 stars for safety and soundness. Keep reading for an analysis of how the credit union did on the three major criteria Bankrate used to score American credit unions on safety and soundness.

WHAT IS
SAFE AND SOUND?

Find out

THE INSTITUTION'S SCORE

Capital Score

Capital acts as a buffer against losses and affords protection for members when a credit union is experiencing financial instability. Therefore, when it comes to measuring an a credit union's financial stability, capital is key. When it comes to safety and soundness, more capital is preferred.

VATAT scored 26 out of a possible 30 points on our test to measure the adequacy of a credit union's capital, beating the national average of 15.65.

VATAT had a capitalization ratio of 26.00 percent in our test, above the average for all credit unions, an indication that it could have an easier time weathering financial trouble than its peers.

Asset Quality Score

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

A credit union with large numbers of these kinds of assets may eventually be required to use capital to cover 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 future failure.

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

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

Earnings score

How successful a credit union is at earning money affects its safety and soundness. Earnings may be retained by the credit union, giving a boost to its capital buffer, or be used to address problematic loans, likely making the credit union more resilient in tough times. Obviously, credit unions that are losing money have less ability to do those things.

On Bankrate's test of earnings, VATAT scored 4 out of a possible 30, below 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, 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.