PLANO, Texas (8/18/15)--Credit union CEO confidence increased in the second quarter of 2015 after fluctuating up and down the previous four quarters, according to Catalyst Corporate FCU’s CEO Confidence Index.
In the second quarter 2015 Credit Union Confidence Survey, the index registered 31.46, up from 30.22 in the first quarter.
The present situation index increased to 31.08 this quarter from 28.70 last quarter, while the expectations index advanced to 31.66 from 30.99.
“The uptick in CEO confidence makes sense, as some strong economic numbers have been released since the first quarter that have had a positive financial impact on credit unions--namely vehicle and home sales,” said Steven Houle, vice president of Catalyst Strategic Solutions’ advisory service.
“U.S. auto sales were strong again in July, with an annualized sales rate of 17.46 million units,” Houle said. “What makes this number impressive is that it came so quickly after a record month. May’s annualized sales rate of 17.63 million units was the strongest since before the recession. More Americans are buying cars, and credit unions are the beneficiaries.”
Home sales also have been strong and are adding to credit union loan growth, Houle said.
“Existing home sales increased in June to a 5.49 million annualized rate, which was the strongest since February 2007,” he added. “With this level of activity, 10% or more loan growth is not out of the question for the industry in 2015. Furthermore, if the Fed keeps a slow and steady pace with their interest rate increases, interest rates should continue to be accommodative for borrowers.”
CEOs’ assessment of members’ current financial condition increased to 27.09 in the most recent survey from 25.25 in the first quarter. Confidence in their own institutions’ current financial condition also climbed to 35.05 from 32.16 in the second quarter survey.
CEOs’ optimism about the short-term economic outlook improved as well. The percentage of CEOs’ expecting members’ financial condition to improve over the next six months rose to 29.66 from 28.79. Optimism about their own institutions’ financial condition in the next half of the year also jumped to 41.91 from 38.64.
Expectations regarding loan demand over the next six months increased to 32.51 after registering 31.12 last quarter. Anticipation for share deposit growth over the next six months declined to 22.55 from 25.38 in the first quarter.