ALEXANDRIA, Va. (9/3/14)--In the second quarter of 2014, federally insured credit unions saw the highest year-over-year loan growth since 2006, the National Credit Union Administration announced Tuesday. Outstanding loan balances rose 9.8%, to $673.9 billion, from the second quarter of 2013, according to call reports from the quarter ending June 30.
According to data from the NCUA:
The Credit Union National Association released its survey results for the month of July this week, which showed similar increases in loan growth (News Now Sept. 2).
"Overall, the 1.4% monthly increase in loans (16.7% annualized) is the fastest monthly advance since August 2005, and the 10.2% year-over-year increase is the highest seen in nearly a decade," said Mike Schenk, interim chief economist at CUNA.
While the NCUA's data showed a slight decrease in long-term investments as a share of assets, NCUA Chair Debbie Matz said she did not believe it would be enough to alleviate NCUA concerns of interest-rate risk. The industry's net long-term asset ratio is currently 35.4%.
"Long-term, fixed-rate assets remain elevated, and interest-rate risk continues to be a key concern and a supervisory priority for NCUA," Matz said.
Total investments by federally insured credit unions are $291 billion, a 2.7% decline from the second quarter of 2013. Investments with maturities of three years or less increased $3 billion from the previous quarter but were $13 billion below the second quarter of 2013.
According to the NCUA, federally insured credit unions with more than $500 million in assets led in most performance measures. These 448 credit unions held $760 billion in combined assets, 69% of the system's total assets during the quarter. Those credit unions also reported faster growth and higher returns on average assets than the credit union system as a whole.
Credit unions with assets of less than $10 million recorded higher net worth ratios but lagged in net worth growth, loan growth, membership gains and return on average assets.
Other notable items from the NCUA data include:
Use the resource link below to access the News Now article on CUNA's monthly survey data.