Las Vegas-based Silver State Schools Credit Union posted lower first-quarter earnings as it recorded a larger charge for its provision for loan losses.
The $789 million-asset credit union said on Thursday it earned about $1.7 million, down 21% from a year earlier. The charge to its provision for loan losses totaled $839,000, compared to $337,000 in the same quarter last year.
Excluding the charge to the provision for loan losses, the credit unions would have earned about $2.6 million in the first quarter.
SSSCU ended the first quarter with deposits of $703 million, loans of $592 million and a net worth ratio of 10.30%, which is considered well capitalized.
Silver State Schools CU said “steadily improving” net interest margin, consumer loan growth and overall asset quality contributed to its results. It said its net interest margin ratio increased 32 basis points, to 3.56%, thanks to increases in its consumer loan portfolio balances and a higher yielding loan portfolio.
Similarly, the management team credited “favorable credit and economic conditions” for lowering its total allowance for loan losses as a percentage of total loans by one basis point, to 0.50%, in the first quarter from a year earlier. During the same period, delinquent loans as a percentage of total loans decreased from 0.39% to 0.20%.
“We are consistently improving our financial strength, as evidenced by our increasing regulatory capital ratio and overall performance,” Scott Arkills, Silver State Schools CU’s president and CEO said in a statement. “Our net income continued to trend strongly for the first quarter of 2019, reflecting excellent loan growth, sustained improvements in asset quality, and a strong deposit retention rate.”
The CU was battered during the Great Recession and endured the painfully slow recovery in Southern Nevada. Silver State Schools had $1 billion in assets prior to the financial crisis, but that plummeted to $622 million at the end of 2012. In 2009, Silver State Schools lost $50.8 million, followed by a loss of $21.4 million in 2010 and $8.4 million in 2011.
It has been profitable for the past seven years. The credit union has benefited from improved consumer confidence and low unemployment trends, according to Arkills.
The credit union is privately insured by American Share Insurance.
Silver State Schools Credit Union was founded in 1951. Today it serves more than 54,000 members of the educational community and their families with nine branches in the Las Vegas Valley.
