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Credit unions grow loans and savings in May

Each month CUNA looks at its Monthly Credit Union Estimates (MCUE) and determines how credit unions are performing. CUNA Vice President of Economics and Statistics, Mike Schenk, sees slight improvements in lending for the month of May.

"Credit union loans grew by 0.54 percent in May--a 6.5 percent annualized rate--and the fastest monthly increase since August 2009, when the federal cash-for-clunkers program was in full swing," said Schenk. 

"Loan growth outpaced the 0.21-percent growth in savings balances--2.5 percent annualized--in the month. As a consequence, the movement's aggregate loan-to-savings ratio increased from 67.1 percent in April to 67.3 percent at the end of May--the second straight month that reflected an increase," Schenk said.
"Seasonally strong borrowing should bring a continuation of this pattern in the coming months, which--all else equal--should have a positive influence on credit union bottom-line results as short-term, liquid investments yielding close to zero are replaced with higher-yielding assets," he added.

Credit union loans totaled $592.7 billion in May, which was a $16 billion improvement from May 2011. Used-auto loans and adjustable-rate mortgages led loan growth, each with a 0.8-percent increase, according to the MCUE. Fixed-rate mortgages and new-auto loans rose 0.7 percent each. Credit card loans were up 0.6 percent, unsecured personal loans grew 0.1%, and home equity loans fell 0.5 percent.
Collectively, credit union asset quality deteriorated, but only marginally as dollar delinquencies inched up from 1.42 percent in April to 1.44 percent in May, Schenk said. The increase represents the first increase after four consecutive months of decline.

Click here to read the full CUNA story.