WASHINGTON (9/5/12)--What will the credit union movement look like in 20 years? According to one analysis of growth trends over the past five years, the credit unions of 2032 could look "remarkably different" than today, with half of today's credit unions disappearing.
A review of asset, member and branch trends in credit unions from 2007 through 2012 points to a massive shift with serious strategic implications, according to marketing strategy specialists at TheFinancialBrand.com (
Sept. 4). The site specializes in marketing strategies for banks and credit unions.
Among the trends it noted in its credit union outlook from the past five years:
Asset growth. Credit union assets have increased to more than $1 trillion today from nearly $761 billion in 2007. Today, 194 credit unions having more than $1 billion in assets, up 57% from 123 in 2007. The top 100 asset credit unions have 38% of all assets in the industry as of 2012.
Number of credit unions. Credit unions' numbers have dropped 14% since 2007. Then, 8,332 credit unions existed, with 85% of those having less than $100 million in assets. In 2012, there are 7,165 credit unions, with 79.6% having assets totaling less than $100 million. The industry is losing about 20 credit unions per month, the site said.
Branches. In 2012, for the first time ever, the number of branches declined, with 27 fewer than last year, said the study. In 2007, credit union branches totaled 20,694, compared with 21,406 in 2012. Last year, credit unions had 21,433 branches. Although branch growth is generally flat, the top 100 asset credit unions added 552 of the 712 new branches reported in the past five years.
Membership. Membership in credit unions rose to 93.7 million in 2012 from 88.5 million in 2007, or 5.87% over five years. The top 100 asset credit unions in 2012 added 1.3 million new members, or 84.4% of all new members in the entire credit union industry. The membership gains at the top 100 are offset for the most part by collective membership losses realized by the rest, said FinancialBrand.com.
Small credit unions. Credit unions with less than $100 million in assets have lost $5 billion in assets and nearly six million members the past five years. Today 80% of all credit unions are in this asset category, down from 85% five years ago.
What do these trends say for the future? The site says if growth continues, there would be 1,218 credit unions in 2032 with assets of $1 billion or more--or 31.3% of all credit unions compared with today's 2.7%. It also predicts the industry's assets would double to $2.2 trillion if the 4% annual growth rate continues and that membership growth will continue to be the biggest challenge credit unions face.
To view the report, use the link.