Friday, May 3, 2019

CUs Offsetting Higher Operating Expenses with Higher Service Charges on Deposits

A study found that credit unions are offsetting higher operating expenses with higher service charges on deposits. But it questions how long this can continue.

According to Moebs Services, non-interest expense-to-asset ratio at credit unions was an average 3.07 percent, almost 20 percent higher than the average at banks.

However, service charges on deposits at credit unions are more than double the service charges on deposits at banks, 61 basis points versus 24 basis points.

But Michael Moebs, Economist & CEO of Moebs Services, noted that "offsetting costly operational expenses with high service charges cannot go on forever.”


  1. I guess Credit Unions will need to grow to the size of banks? We all know about efficiencies of scale; Credit Unions are smaller so they should have a higher OpEx to Asset ratio - correct?

    1. You are right about size and economies of scale. However, I don't know if Moebs Services use industry data or his client data.



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