Significant Alliant Credit Union Health Rating Disparity

Kaight | Jan 11, 2024 | 1,192 posts since 2011

Sometimes this stuff just sort of jumps out at you right off the screen! And of course there never is a dull moment in this life. That is a given.

Anyway, no matter how you look at things, Ken luv, luv, luvs Alliant. Check that health rating. It's top of the charts at "A+". Dang that's a stellar rating!

Marty Weiss, over at Weiss Research, is a noted party pooper. His ratings are always dark and severe, and everyone is aware of that. At Marty's party, poor Alliant Credit Union comes in with a lowly "C" health rating, down from "B" only a few quarters ago. That's a "fur piece" from "A+", even allowing for Marty's irascible proclivities.

I wonder, when Ken updates his health ratings with Q3 2023 data, if his Alliant Credit Union health rating will decline. We shall see. Stay tuned.

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Kaight | Jan 11, 2024 | 1,192 posts since 2011

Out of curiosity I just checked Bauer's Alliant rating. Like Weiss, Bauer is also basing ratings on Q3 2023 data, the most recent available.

Bauer gives Alliant five stars, its highest rating. Obviously you may make of that what you will. These health ratings are always subject to interpretation. I am merely your humble reporter.

For anyone wondering about ratings based on 2023 year end data, those health ratings will not become available until (very roughly) mid March.

racecar | Jan 12, 2024 | 628 posts since 2014

Thanks for bringing up the disparity in the ratings.

I noticed the same thing with another (small, 1-branch) CU a few years ago when I had a large CD there. The ratings at the time ranged from A to D depending on if it was DA, Weiss or Bauer, and I didn't know what to do. Over the years I've had 2 CUs go out of business on me while having CDs with them (with one, the acquiring FI kept the old terms, but with the other they gutted the interest to near 0%).

Like yourself I'm just an average consumer and don't have the knowledge to dig into each line of a place's financials. Thankfully, the NCUA and FDIC are around, and unlike other investments, CDs are protected if within the limits and/or done right -- though it's still a pain when a place goes out of business.

If 2008 showed us anything though, it showed us that ratings agencies can absolutely be corrupt, with no consequeces even when that's proven in court (after all, their ratings are just "opinions" and protected by "free speech" no matter how corrput). This isn't to say they currently are or aren't corrupt... but recent history has shown that they can act jaw-droppingly corrupt and suffer absolutely no consequences at all for it, so I'd be a fool to believe them blindly.

So I do the only thing someone like me can do: look at them and put that data into the mix in my head as part of a bigger picture, but not as the only factor. See if it's the same across the board or different opinions among the different places. See if the amount of the CD is under the FDIC/NCUA limit. If it's not, if the PODs are clearly and correctly in place. Perhaps if "Bubba's Credit Union" is given an "F" by all 3, if my CD is over the 250k limit, and if the CU says it's not possible to give me written proof of my PODs, I might step away. But unless it's extreme like that, the ratings are just another data point among many to consider, but not follow blindly. That's how it is for me, anyway. Again, unlike with the market, thankfully there's the NCUA and FDIC to help prevent the worst case scenario.

trav99 | Jan 12, 2024 | 14 posts since 2022

Well the 3 credit agencies can have 3 different scores for the same person that are not always close too. But yes I'm sure glad there is the fdic and ncua for CDs. At least then we are protected no matter what the ratings companies try to tell us

American | Jan 21, 2024 | 6 posts since 2024

Wow! Only harsh consequences curb corruption.

American | Jan 21, 2024 | 6 posts since 2024

To emphasize:
"...the bigger threat is about what those dollars will be worth in the event of a systemic bank failure".

Thank you very much !!

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