ALEXANDRIA, Va. – The NCUA released its March 2013 Call Report Thursday that shows federally insured credit unions experienced a decline in delinquencies and charge-offs in the first quarter of 2013, while loans grew faster than in any first quarter since 2008. Credit unions also experienced dramatic membership growth of more than 800,000 new members.
“It’s encouraging to see delinquencies and charge-offs falling as loan portfolios and membership continue to grow,” NCUA Board Chairman Debbie Matz said. “During the first quarter, the credit unions closed in on $600 billion in total loans and added more than 800,000 members to reach 94.6 million Americans.
“While there are many positive signs in these statistics, I remain concerned about the disparate recovery of credit unions by asset size. The 423 largest credit unions had a return on average assets of 100 basis points for the quarter. In comparison, 2,279 credit unions with less than $10 million in assets had a return on average assets of negative 14 basis points, and 3,007 credit unions with $10 million to $100 million in assets had a return on average assets of 30 basis points.”
Federally insured credit unions reported $599.9 billion in total loans, up $2.3 billion in the first quarter of 2013, the eighth consecutive quarter of loan growth. This loan growth was the fastest pace for the first quarter in five years.
The delinquency ratio of federally insured credit unions declined, dropping 14 basis points (bp) to 1.02%. Net charge-off ratios also dropped significantly by 12 bp points, to 0.61%. The agency notes that the declines reflect significant improvement from the highs of 1.84% for delinquencies and 1.21% for charge-offs reached in 2009.
CUNA President/CEO Bill Cheney said the growth in membership numbers reflect "a real cultural shift that is taking place."
"Not only do credit unions generally offer better rates and lower fees, they have powerful appeal in today's environment where so many people are put off by big conglomerates and are turning instead to locally based, community-oriented businesses.
"Credit unions, as cooperatives owned by the people they serve, embody those traits, and consumers are flocking to them in huge numbers. Today new tools like our consumer web site, www.aSmarterChoice.org, make it easier than ever for consumers to find a credit union they can join," he added.
NCUA’s March 2013 Call Report is available here.