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TelComm Makes "Healthiest Credit Unions" List

Recently, TelComm Credit Union (Springfield) was mentioned in's "Top 200 Healthiest Credit Unions" list. used its own proprietary formula to assess the financial health of all federally insured banks and credit unions in the US. Some of the key components of the formula included:

  • Texas Ratio - This ratio is determined by comparing the total value of at-risk loans to the total value of funds the financial institution has on hand to cover these loans. At-risk loans are any loans that are more than 90 days past due and are not backed by the government. The amount of funds on hand consists of the loan loss allowance that the bank has set aside plus any equity capital. For example, a bank with $65 million in at-risk loans and $72 million in cash on hand to cover those loans would have a Texas Ratio of $65mm / $72mm, which is 90.3%. This figure is approaching the 100% threshold, which is considered very risky. 
  • Deposit Growth - A strong track record of stable growth is an indicator of consumer confidence and the bank's ability to strengthen its balance sheet. However, the opposite can indicate a decline in confidence. If deposits are declining over a prolonged period of time, it could mean that the financial institution’s ability to keep a strong balance sheet is in jeopardy.
  • Capitalization - Available capital can be calculated directly from an institution’s assets minus its liabilities. Stronger capital means that more assets are available to cover potential losses.

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