During the first quarter, assets grew by 2.7 percent to almost $1.42 trillion, loans expanded by 1.5 percent to $971.9 billion, and total shares and deposits were up 3.8 percent to $1.2 trillion.
Indirect loans grew by 3.5 percent during the first quarter to $201.3 billion. Indirect loans account for 20.71 percent of all loans.
Since deposits expanded at a faster rate than loans, the loan-to-share ratio at federally-insured credit unions fell from 82.56 percent at the end of 2017 to 80.75 percent as of March 2018.
FICUs reported a $3.1 billion increase in net worth during the first quarter of 2018 to $154.2 billion. The industry's net worth ratio fell by 7 basis points during the quarter to 10.88 percent as of March 2018; however, it is up 19 basis points from a year ago.
As of March 2018, 40 FICUs were undercapitalized with a net worth ratio below 6 percent including 7 credit unions with leverage ratios below 2 percent.
Credit unions reported an almost $9.5 million increase in subordinated debt counting as net worth to $232.9 million during the first quarter.
Net Income Up 35.4 Percent Year-over-Year
Net income at federal credit unions was up 35.4 percent year-over-year to $3.14 billion at the end of the first quarter.
The return on average assets (ROAA) was 0.90 percent at the end of the first quarter of 2018 -- up 12 basis points from last quarter and 19 basis points from a year ago. Factors contributing to the higher ROAA during the first quarter were higher net interest margins (+4 basis points), fee and other income (+6 basis points), and non-operating income (+1 basis point). Lower operating expenses added 1 basis point to ROAA.
Loan Quality Improved During Q1
FICUs reported fewer delinquent loans during the first quarter of 2018. Delinquent loans fell by 18.1 percent during the quarter to $6.4 billion as of March 31, 2018. Also, loans 30 to 59 days past due declined by 14 percent during the quarter to $8.7 million.
Net charge-offs were $1.44 billion on March 31, 2018. In comparison, net charge-offs were $1.28 billion a year earlier.
The delinquency rate on loans fell by 15 basis points during the quarter to 0.66 percent as of March 31, 2018, while the net charge-off rate was flat during the quarter at 0.60 percent.
Troubled debt restructured loans were nearly flat during the quarter at $8.95 billion.
Read the press release.
Q1 Chart Book.
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