MADISON, Wis. (10/2/13)--Credit union loans, membership and savings all went up in August, according to the August monthly sample of credit unions by the Credit Union National Association. Loan growth year over year is the quickest in five years, said a CUNA economist.
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CUNA released its Monthly Credit Union Estimates Tuesday. Credit union loans totaled $643.8 billion in August, compared with $605 billion in August 2012. Credit union loans outstanding grew 1.1% in August, led by adjustable-rate mortgages (a 1.9% growth), unsecured personal loans (1.8%), new-auto loans (1.5%), used-auto loans (1.3%), fixed-rate first mortgages (1%) and credit card loans (1%). Other mortgages and home equity loans each declined 0.2%.
"Credit union loan growth is surprisingly on the upside with balances increasing 1.1% in August and 6.4% year over year," Steve Rick, CUNA senior economist, said Tuesday. "This is the fastest pace since the 6.7% increase in 2008. With car sales reaching more than 15 million units this year, credit union new-auto loan balances are surging. Over the past year, new-auto loan balances increased 11.9%--the fastest growing credit union loan category.
"Credit unions are holding more fixed-rate mortgages on their balance sheet rather than selling them off into the secondary market," he added. "Fixed-rate first mortgage loan balances rose 1% in August and 10.5% year over year.
"Deleveraging in the home equity loan category is slowing as balances fell only 3.7% over the last year, compared with a 4.1% decline in the year ending August 2012," Rick continued. "With home prices rising 8% to 10% across the country, home-equity loan balances should start rising again in 2014."
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Credit union savings balances totaled $932.6 billion in August--or $40.3 billion more than the $892.3 billion in August 2012, said CUNA's report. Credit union savings balances grew 0.9% for the month, compared with a 0.5% decrease in July. The increase is a reflection of three paydays during August with the last payday landing on the last day of the month, CUNA said. Share drafts grew 6.9%, money market accounts were up 0.5%, and regular shares grew 0.1%. On the decline were one-year certificates, which dropped 0.3%, and individual retirement accounts, with a 0.1% decline.
"Savings-balance growth is surprising on the down side in 2013, with year-over-year growth of only 4.5%," Rick said. "Pent-up demand for durable goods, negative real deposit interest rates, 5% higher fuel costs and the expiration of the payroll tax cut are all reducing the pace of savings growth."
Total credit union membership grew 0.4% during August and now totals 98.3 million.
The movement's overall capital-to-asset ratio remained at 10.2%. The total dollar amount of capital is $110 billion.
Credit unions' 60-plus-day delinquency rate has remained at 1% for the past six months.
With loan growth outpacing savings growth during August, the loan-to-savings ratio increased to 69% in August from 68.9% in July. The liquidity ratio--the ratio of surplus funds maturing in less than one year to borrowings plus other liabilities--is 17.8%.