Numbers of CUs down, but assets on the grow
According to CUNA Mutual Group’s December Trends Report, as of October 2016, CUNA estimates 5,815 credit unions were in operation, down 257 from October 2016. Year-to-date the number of credit unions fell by 207, significantly more than the 164 reported in the first ten months of 2016. NCUA’s Insurance Report of Activity showed 16 mergers were approved in October with an average asset size of $18.5 million. This is down from the 11 mergers reported in October 2016 with an average asset size of $7.9 million.
Credit union consolidation and concentration is expected to continue at its long run pace in 2018. Since 1980, the number of credit unions has declined by roughly 3.5 percent each year (Figure 12). If we apply this exponential “decay” rate to the current number of credit unions, 5,815, we should expect another 203 credit unions to exit the financial system in 2018. If we forecast out a little further, according to the laws of exponential decay, there will only be 2,955 credit unions in 20 years, half as many as there are today. Fortunately, credit union assets follow an average annual exponential growth of percent. This means the time it takes for credit union assets to double (currently $1.389 trillion) is only 10 years.
See the full December Trends Report here.