NCUA: Q4 2016 Credit Union System Financial Performance Data Now Available

ALEXANDRIA, Va. (March 6, 2017) – The National Credit Union Administration today released the new credit union system financial performance figures based on Call Report data submitted to and compiled by the agency for the quarter ending Dec. 31, 2016.

NCUA makes detailed credit union system performance data available on its Credit Union and Call Report Data webpage, including a quarterly data summary and financial performance reports. The agency’s Industry Data page includes a chart package illustrating industry financial trends.

Selected Performance Indicators

• Total assets in federally insured credit unions rose by $88 billion, or 7.3 percent, over the year to $1.29 trillion in the fourth quarter of 2016.
• Total loans outstanding increased $82 billion, or 10.4 percent, over the year to $869.1 billion. The average outstanding loan balance in the fourth quarter of 2016 was $14,195, up $486, or 3.5 percent, from one year earlier.
• The delinquency rate at federally insured credit unions was 83 basis points in the fourth quarter of 2016, little changed from 81 basis points one year earlier. The net charge-off ratio was 55 basis points, up from 48 basis points in the fourth quarter of 2015.
• Insured shares and deposits rose $67 billion, or 7.0 percent, over the four quarters of 2016 to more than $1 trillion.
• The loans-to-shares ratio stood at 79.5 percent in the fourth quarter of 2016, up from 77.5 percent in the fourth quarter of 2015.
• The credit union system’s net worth ratio was 10.89 in the fourth quarter of 2016, compared with 10.92 one year earlier.
• Net income totaled $9.6 billion in 2016, up $0.9 billion, or 10.6 percent, from 2015.
• The net interest margin for federally insured credit unions was $36.0 billion in the fourth quarter of 2016, or 2.9 percent of average assets.
• The return on average assets for federally insured credit unions was 77 basis points in 2016, little changed from 75 basis points in 2015. The median return on average assets was 35 basis points, compared with 33 basis points one year earlier.
• The number of federally insured credit unions declined to 5,785 in the fourth quarter of 2016 from 6,021 in the fourth quarter of 2015. In the fourth quarter of 2016, there were 3,608 federal credit unions and 2,177 federally insured, state-chartered credit unions. The number of credit unions with a low-income designation rose to 2,491 in the fourth quarter from 2,297 one year earlier.
• Federally insured credit unions added 4.2 million members over the year, and membership reached 106.9 million in the fourth quarter of 2016.

Balance Sheet Details

ASSETS:

• Total assets in federally insured credit unions rose by $88 billion, or 7.3 percent, over the year to $1.29 trillion in the fourth quarter of 2016.
• Cash and equivalents (assets with maturity of three months or less) rose $3.2 billion, or 3.4 percent, to 97.8 billion.
• Total investments (instruments with maturities in excess of three months) declined $3.6 billion, or 1.3 percent, to $269 billion.
  • Investments with maturities of less than one year were up $8 billion, or 11.8 percent, to $75.6 billion
  • Investments with maturities of one to three years declined $6.8 billion, or 6.7 percent, to $94.9 billion.
  • Investments with maturities of three to five years declined $7.1 billion, or 10.0 percent, to $64.1 billion.
  • Investments with maturities of five to 10 years were up $2.9 billion, or 10.5 percent, to $30.7 billion.
  • Investments with maturities greater than 10 years declined $500 million, or 10.6 percent, to $4 billion.
• Total loans outstanding increased $82 billion, or 10.4 percent, to $869.1 billion. Credit union loan balances rose over the year in every major category, compared with the fourth quarter of 2015.
  • Auto loans increased $36.7 billion, or 14.0 percent. Used auto loans rose $19.9 billion, or 12.3 percent, to $181.8 billion. New auto loans rose $16.8 billion, or 16.8 percent, to $116.9 billion.
  • Real estate loans rose $34.3 billion, or 8.6 percent, over the year to $431.1 billion in the fourth quarter of 2016.
  • Net member business loan balances, including unfunded commitments, increased $8.5 billion, or 14.6 percent, to $66.6 billion in the fourth quarter.
  • Credit card balances rose $3.8 billion, or 7.9 percent, to $52.7 billion
  • Non-federally guaranteed student loans rose $0.3 billion, or 9.0 percent, to $3.8 billion.
• The delinquency rate on loans at federally insured credit unions was 83 basis points in the fourth quarter of 2016, little changed from 81 basis points one year earlier. Loan performance was mixed across categories:
  • The delinquency rate on fixed real estate loans was 54 basis points in the fourth quarter, down from 64 basis points one year earlier.
  • The credit card delinquency rate was 114 basis points, up from 101 basis points in the fourth quarter of 2015.
  • For auto loans, the delinquency rate was 72 basis points in the fourth quarter of 2016, compared with 68 basis points one year earlier.
  • The delinquency rate for member business loans stood at 158 basis points, up from 109 basis points in the fourth quarter of 2015.
  • The student loan delinquency rate was 126 basis points in the fourth quarter of 2016, compared with 115 basis points one year earlier.
• The net charge-off ratio for all federally insured credit unions was 55 basis points in the fourth quarter of 2016, up from 48 basis points in the fourth quarter of 2015.

LIABILITIES AND NET WORTH:

• Credit union shares and deposits rose by $76.6 billion, or 7.5 percent, over the year to $1.09 trillion in the fourth quarter of 2016. Regular shares rose $41.7 billion, or 11.8 percent, to $393.7 billion. Other deposits increased $31.6 billion, or 6.1 percent, to $545.2 billion, led by money market accounts, which rose $17.4 billion, or 7.5 percent, and share certificate accounts, which were up $9.4 billion, or 4.9 percent.
• The credit union system’s net worth increased by $9.3 billion, or 7.1 percent, over the year to $140.8 billion. The aggregate net worth ratio – net worth as a percentage of assets – stood at 10.89 percent in the fourth quarter of 2016, compared with 10.92 percent one year earlier.

Income Statement Details

• Net income for federally insured credit unions in 2016 totaled $9.6 billion, up $0.9 billion, or 10.6 percent, from 2015. Interest income rose $3.4 billion, or 8.6 percent, in 2016 to $42.6 billion, and non-interest income increased $1.6 billion, or 9.9 percent, to $17.4 billion.
• Interest expense totaled $6.6 billion in 2016, up $0.5 billion, or 8.8 percent, from one year earlier. Non-interest expenses grew $2.5 billion, or 6.9 percent, to $38.7 billion in 2016. Rising labor expenses, which were up $1.3 billion, or 7.0 percent, accounted for roughly half of the increase in non-interest expenses.
• The aggregate net interest margin widened $2.9 billion, or 8.6 percent, in 2016 to $36.0 billion.
• The credit union system’s provision for loan and lease losses rose $1 billion, or 24.8 percent, to $5.1 billion in 2016.

Performance by Asset Category

• Credit unions with assets greater than $1 billion reported the strongest growth in loans, membership and net worth over the year ending in the fourth quarter of 2016. At the end of the fourth quarter of 2016, the 272 federally insured credit unions with assets in excess of $1 billion held 61 percent of total system assets. Loan growth was 15.4 percent. Membership growth was 10.8 percent. Net worth rose 12.5 percent.
• Credit unions with more than $100 million in assets, but less than $500 million, reported loan growth of 3.9 percent over the year ending in the fourth quarter of 2016. Membership growth was negative 0.3 percent. Net worth growth was 2.0 percent. At the end of the fourth quarter of 2016, the 1,050 federally insured credit unions in this category held $234 billion in total assets, or 18 percent of total system assets.
• The number of credit unions with less than $50 million in assets fell over the year ending in the fourth quarter of 2016. This category of credit unions reported declines in loans outstanding, membership, and net worth over the year.
• The 3,510 credit unions with less than $50 million in assets accounted for 4.0 percent of total system assets in the fourth quarter of 2016.
• Credit unions with $10 to $50 million in assets reported a 5.0 percent decline in loans, an 8.7 percent decline in membership and a 5.7 percent decline in net worth.
• For credit unions with less than $10 million in assets, loans declined 6.5 percent, membership fell 10.0 percent, and net worth fell 6.7 percent.