Data Shows Credit Union Gains in Q2

YOUNGSTOWN, Ohio – Total loans outstanding in federally insured credit unions increased $194 billion, or 16.2%, over the year ending in the second quarter of 2022, to $1.39 trillion.

This represents the largest year-over-year growth in loans outstanding in at least two decades. Credit union loan balances also rose in all major categories, compared with the second quarter of 2021.

During the same period, total assets climbed by $159 billion, or 8.1%, to $2.14 trillion, according to data compiled by the National Credit Union Association. Insured shares and deposits grew $110 billion, or 7.0%, to $1.69 trillion, from 2021.

“These latest quarterly industry performance results point to a growing and overall healthy credit union system that’s facilitating the ability of families to achieve their financial goals,” said NCUA Chairman Todd M. Harper.

“But, at the same time, we have also seen declines in the system’s net income and returns on average assets, rapidly rising interest rates and continued inflationary pressures. And, we have identified growing liquidity concerns within the system. Therefore, credit unions of all types and sizes must remain diligent in managing safety and soundness as we continue to navigate the challenging economic environment ahead of us,” Harper pointed out.

The NCUA quarterly data summary provides an overview of the financial performance of federally insured credit unions based on information reported to the agency in the second quarter of 2022.

As of June 30, there were 4,853 federally insured credit unions with 132.6 million members.

Additional highlights from the NCUA data summary include:

• Net income for federally insured credit unions in the first half of 2022 totaled $18.0 billion at an annual rate, down $3.3 billion, or 15.4%, from the first half of 2021.

• Interest income rose $5.7 billion, or 9.8%, over the year to $63.6 billion. Non-interest income fell $3.1 billion, or 11.7%, to $23.6 billion, largely due to a drop in other income.

• The credit union system’s provision for loan and lease losses or credit loss expense increased $2.1 billion, or 154.8%, to $3.4 billion at an annual rate in the first half of 2022.

• The delinquency rate at federally insured credit unions was 48 basis points in the second quarter of 2022, up 2 basis points compared with the second quarter of 2021.

• Credit union shares and deposits rose by $139.7 billion, or 8.1%, over the year to $1.85 trillion in the second quarter. Regular shares increased $62.3 billion, or 9.9%, to $689.0 billion. Other deposits increased $37.1 billion, or 5.0%, to $782.5 billion, led by money market accounts, which grew $52.2 billion, or 13.9%, over the year.

• The credit union system’s net worth increased by $21.6 billion, or 10.8%, over the year to $222.7 billion.

• The aggregate net worth ratio – net worth as a percentage of assets – stood at 10.42% in the second quarter, up from 10.16% one year earlier.

SOURCE: National Credit Union Association.