Monday, March 7, 2016

Large CUs Prosper, Small CUs Struggle

Credit union industry data tell two stories about the credit union industry. For large credit unions it is the best of times, while for small credit unions it is the worst of times.

Federally insured credit unions with more than $500 million in assets continued to lead the system in most performance measures in the fourth quarter of 2015. With $867.5 billion in combined assets, these 481 credit unions held 72 percent of total system assets.

In fact, it is the 250 credit unions with at least $1 billion in assets that is fueling the industry's growth. These 250 credit unions hold $705.1 billion in assets of 58.5 percent of the industry's assets.

In addition, these large credit unions reported the fastest growth in loans, membership and net worth as well as the highest return on average assets. The return on average assets was 0.86 percent for credit unions with $500 million or more in assets.

On the other hand, smaller credit unions continue to struggle.

Membership in the smallest credit unions continued to decline in 2015. Credit unions with $10 million to $100 million in assets experienced a membership growth of minus 0.1 percent. Credit unions with less than $10 million in assets reported a membership growth rate of negative 1.4 percent.

Credit unions with less than $10 million in assets reported a return on average assets of 4 basis points. While these credit unions have the industry's highest net worth ratio of 15.05 percent, they also have the highest delinquent loan ratio of 1.89 percent.

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