MADISON, Wis. (12/3/14)--Credit union loans outstanding climbed 0.8% in October, an even faster pace than September's increase in loan growth, the Credit Union National Association's credit union monthly estimates (MCUE) found.
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Adjustable-rate mortgages led the way, rising 2.3%, followed by new-auto loans (2.2%), home-equity loans (1.4%), other mortgages (1.1%), used-auto loans (0.9%) and unsecured personal loans (0.7%).
Fixed-rate mortgages fell in October by 1.2%.
"The improving economy has credit union members opening their wallets, and they are increasingly more comfortable with big-ticket purchases," Mike Schenk, CUNA vice president of economics and statistics, told News Now. "This is reflected in continuing fast growth in credit union loan portfolios.
"October's 0.85% increase in loans (10.2% annualized) is marginally faster than September's 0.81% increase, and also faster than the result reported in October 2013 when loans grew by 0.72%, or 8.64% annualized."
Schenk added that credit union loans have climbed 8.9% since the start of 2014, and have posted a 10.3% increase in annual growth, the fastest year-over-year increase since 2005.
"Loan growth rates remained strong in nearly every loan category we track," Schenk said. "New-auto loans led the way with a 20.5% year-over-year increase, while used autos (12.5%) and unsecured personal loans (11.7%) also reflected double-digit gains in the 12-month period.
"Beyond this, the MCUE report reflects healthy increases in mortgages, which increased 8.2%, and in credit cards, which increased 6.8% over the past year."
The estimates also illustrated a solid uptick in credit union memberships in October, with a 0.2% increase for the month to 101.6 million.
The increase is slightly lower than membership gains posted in September, but memberships continue to outpace their year-ago levels.
"The 0.18% monthly increase in memberships (0.72% annualized) represented a slowdown compared with September results, but was substantially faster than the year-ago 0.01% advance. Overall, credit union memberships are up 3.3% in 2014 and are 3.6% higher over the past 12 months," he said.
By contrast, Schenk said, the U.S. Census Bureau reports the country's population has risen at a rate of less than 1% in recent months, meaning that memberships have expanded more than 3.5 times faster than population growth.
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Asset quality also continues to improve, as the national credit union 60-day delinquency rate sits at 0.7%, which is 0.26% lower than where it was at the start of 2014, and the lowest reading since August 2007.
Savings balances at credit unions increased 1.3% in October, the estimates found, compared with a 0.7% decrease in September.
And the credit union industry's overall capital-to-asset ratio came in at 10.8% for the month, with a total dollar amount of capital of $123.4 billion.
"CUNA economists expect strong loan growth to continue, fueled by improving labor markets, higher incomes and an abundance of pent-up demand," Schenk said.