CUNA estimates show 2016 off to good start for CUs

March 2, 2016

MADISON, Wis. (3/2/16)--The steady, upward trajectory for credit union growth continues in membership numbers and lending--although opportunities exist, particularly in the housing market.

The monthly credit union estimates from the Credit Union National Association (CUNA) show memberships are up 105.6 million in January from 105.3 million in December last year. Loan growth increased 0.64% for an annualized basis of 7.62%, cresting loan balances at $102 billion in January.


Click image to enlarge.

“Our estimates are consistent with a macroeconomic theme we see this year, that is continued U.S. expansion--although under 3%,” said CUNA Senior Economist Perc Pineda. “We are confident that loan growth will reach our annual forecast of 9% this year. Recovery in housing however has been the slowest in history.”

Adjustable mortgages led loan growth in January with an increase of 2.6%. Home equity loans ticked upward by 1.6%; however fixed-rate first mortgages slumped 1.3%.


Click image to enlarge.

“One thing to note is that credit union mortgage lending remained robust even immediately after the Great Recession,” Pineda said. “It is disconcerting that credit unions are trapped, particularly small credit unions, in the current regulatory environment saddled with new rules and procedures. Although credit unions did not cause the housing crisis, recent regulatory burden weighs heavily on credit unions’ ability to serve members--particularly in mortgage lending.”

He added, “We could have a strong housing recovery now that the economy is heading into the seventh year of economic growth against the backdrop of low unemployment and stable prices. Mortgage lending could pick up pace and the net effect on the economy will be positive, but not if regulations continue to take a toll on working-class Americans.”

Other statistics from the survey:

  • A lift in new-auto loans (1.6%), used-auto loans (1.3%) and unsecured personal loans (0.7%);
  • An increase in the loan-to-savings ratio to 78.2% in January from 77.4% in December;
  • A 0.3% decline in savings balances in January compared with a 1.2% increase the month prior;
  • A stable overall capital-to-asset ratio that remained at 10.8% in January; and
  • A steady asset quality with credit unions’ 60-plus day delinquency at 0.8%.