Safe and Sound

WINTHROP AREA

WINTHROP, ME
4
Star Rating
WINTHROP, ME-based WINTHROP AREA is an NCUA-insured credit union started in 1937. As of December 31, 2017, the credit union held assets of $66.3 million.

With 14 full-time employees, the credit union currently holds loans and leases worth $41.2 million. Its 5,904 members currently have $59.0 million in shares with the credit union.

Overall, Bankrate believes that, as of December 31, 2017, WINTHROP AREA 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 key criteria Bankrate used to score American credit unions.

WHAT IS
SAFE AND SOUND?

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THE INSTITUTION'S SCORE

Capital Score

When it comes to measuring a credit union's financial resilience, capital is essential. It acts as a cushion against losses and provides protection for members when a credit union is experiencing financial instability. From a safety and soundness perspective, the more capital, the better.

WINTHROP AREA scored below the national average of 15.65 on our test to measure capital adequacy, scoring 12 out of a possible 30 points.

WINTHROP AREA appears to be weaker than its peers in this area, with a capitalization ratio of 12.00 percent in our test, below the average for all credit unions.

Asset Quality Score

This test's purpose is to estimate 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 a large number of these kinds of assets may eventually have to use capital to absorb losses, decreasing its equity buffer. Many of those assets are also likely to be in non-accrual status and thus aren't earning interest for the credit union, decreasing earnings and increasing the risk of a future failure.

On Bankrate's asset quality test, WINTHROP AREA scored 40 out of a possible 40 points, beating the national average of 38.09 points.

WINTHROP AREA's ratio of troubled assets was 0.00 percent in our test, less than the national average and suggestive 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 can be retained by the credit union, boosting its capital buffer, or be used to deal with problematic loans, likely making the credit union more resilient in times of trouble. Credit unions that are losing money, however, have less ability to do those things.

On Bankrate's earnings test, WINTHROP AREA scored 10 out of a possible 30, coming in below the national average of 10.11.

The credit union had an earnings ratio of 0.00 percent in our test, higher than the average for all credit unions, suggesting that it's running ahead of its peers in this area.

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.