Introduction to West Texas Credit Union

West Texas Credit Union has been operating for 69 years, having first been established in the year 1953. The credit union mainly focuses on the provision of auto loans which represent 62% of its loans outstanding. In terms of its overall asset base, West Texas Credit Union is larger than 55% of credit unions in the country. West Texas Credit Union’s deposits are insured by the National Credit Union Administration (NCUA), which operates very similarly to the Federal Deposit Insurance Corporation, except with a focus on credit unions. The NCUA also regulates and supervises West Texas Credit Union’s operations. The company has a total of 2 branches and employs a total of 20 employees.

Discussion of the Credit Union’s Operations

The credit union currently has total assets of $62 million, total deposits of $56 million and net loans outstanding of $38 million. On average its members had a total of $10,788 deposited with the credit union – this is a helpful metric to monitor as it provides us with an idea of the level of engagement of the credit union’s membership base. The average credit union in West Texas Credit Union’s peer set has a loan to deposit ratio of approximately 55%. In comparison, West Texas Credit Union has a loan to deposit ratio of 69% which is clearly higher than the peer set. A lower ratio is generally better as it indicates that the lending activities of a credit union are more comfortably covered by its deposit base. Deposits are often the most cost effective source of funding for banks and credit unions. Lastly, West Texas Credit Union’s loan portfolio mainly consists of auto loans and mortgages and lines of credit which represent 62% and 29% of its loan book and had outstanding balances of $24 million and $11 million, respectively.

Contact and Other Helpful Information

  • Main Office Address: 4301 Mission Blvd, Odessa, TX 79765
  • Website: http://www.westtexascu.com
  • Phone: (432) 934-0433
  • Charter Number: 67592
  • Charter Year: 1953
  • Employees: 20
  • Routing Number: 316386777
  • Membership: Credit unions in the state of Texas have an average membership base of 22,703 compared with West Texas Credit Union which has total members of 5,170. Over the past two years, the credit union’s total membership has increased by 1%.

West Texas Credit Union: Financial Overview

west texas credit union-balance-sheet-metrics

As shown in the above chart, West Texas Credit Union’s assets have grown by 2.3% over the past year, while its auto loans – which is its largest category of lending – have expanded by 8.3% over the past year. Furthermore, the company’s deposits have expanded by 7.4% while its total loans have increased by 6.7%. ‘Net worth’ is a good way to assess the long-term performance of a credit union as it represents the accumulated value of the entity over time. Importantly this is value that accrues to the credit union’s owners: its members. West Texas Credit Union has a total net worth of $5 million. This implies that the credit union has a net worth per member of $1,058 which is below the national average of $1,606.

Overview of the Credit Union’s Performance Metrics

west texas credit union-selected-performance-metrics

In the above chart we have displayed three statistics that are important in evaluating a credit union’s performance and shown how West Texas Credit Union compares on these metrics, in addition to detailing how the credit union performed on each metric in the prior year. Beginning with West Texas Credit Union’s return on assets (aka ROA), on this statistic the credit union performs below the average comparable credit union. When we look at the year over year trends, we can see that ROA has declined given the 0.43% change. A credit union’s ROA is a good way of assessing how well the entity is using its assets to generate returns. Moving on to the credit union’s delinquency rate, which tells us how much of a credit union’s loan book is delinquent, the credit union is above its peer group on this metric and compared with the prior year it has been relatively stable. Keep in mind that a higher delinquency rate indicates a lower performing loan book so a declining rate is a favorable trend. The net worth ratio for the credit union is 8.8% and has been relatively stable compared with the prior year figure of 8.9%. The credit union is also below its peer group average of 10.2% on this metric. Finally, based on the NCUA guidelines, the company’s net worth ratio would classify it as well capitalized.

Conclusion

Ultimately, after considering all of the relevant factors we rate West Texas Credit Union 2.4 out of 5.0, which is average. Importantly, please be aware that none of the information presented is meant to be investment advice or advice of any form. All of the information and views expressed in this note and on this site are purely for informational purposes.