LACE Financial Credit Ratings are a measure of the overall financial condition of an institution and its ability to meet its credit obligations.  In the past, LACE Financial Corporation has issued more than a million financial soundness ratings.

A+ and A An institution that has an exceptional financial condition, little or no nonperforming assets, and is highly capitalized with strong earnings.  These grades are the highest level of financial soundness.

B+ An institution with an overall strong financial condition, but not as strong as A+ and A rated companies.  The company is most likely to meet its credit obligations under severe economic, financial and business conditions.

B An institution with an adequate financial condition that is likely to meet its credit obligations under severe economic, financial and business conditions.

B- and C+ An institution with an adequate financial condition but is more susceptible to adverse changes in economic conditions that could affect its ability to meet its credit obligations.  Lowest investment grade rating.

C and C- An institution whose financial condition is judged to be relatively weak and its ability to meet financial obligations could be affected by adverse economic, financial or business conditions.  Non-investment grade.

D and E Institutions are likely to have financial problems (poor LACE Financial ratios) and careful consideration should be made about investments in these institutions.  These institutions are likely to have a higher probability of failure than institutions with higher ratings.  LACE Financial recommends that all credits on D and E rated institutions be secured.  Non-investment grade.

New banks, less than three years old with total assets less than $30 million, are not rated.  However, financial data is listed for the banks and a "NB" is shown in their rating space.  New savings & loans, which are less than three years old, are also not rated and an "N" will be shown in its rating space.  Atypical banks, bank holding companies, S&Ls, and those missing key financial data necessary to derive a rating, are not rated and an "NR" is shown in their rating space.  It should be noted that fraudulent financial reporting by institutions might result in incorrect LACE Financial Credit Ratings.