NCUA Releases Q2 2017 Credit Union System Performance Data

ALEXANDRIA, Va. (Sept. 6, 2017) – Data on the financial performance of federally insured credit unions in the quarter ending June 30, 2017, are now available from the National Credit Union Administration.

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

Selected Performance Indicators       

• Total assets in federally insured credit unions rose by $96 billion, or 7.7 percent, over the year to $1.35 trillion in the second quarter of 2017.
• Total loans outstanding increased $90 billion, or 10.9 percent, over the year to $913.0 billion. The average outstanding loan balance in the second quarter of 2017 was $14,613, up $665, or 4.8 percent, from one year earlier.
• The delinquency rate at federally insured credit unions was 75 basis points in the second quarter of 2017, unchanged from one year earlier. The net charge-off ratio was 57 basis points, up from 51 basis points in the second quarter of 2016.
• Insured shares and deposits rose $78 billion, or 7.8 percent, over the four quarters ending in the second quarter of 2017 to $1.1 trillion.
• The loans-to-shares ratio stood at 79.7 percent in the second quarter of 2017, up from 77.8 percent in the second quarter of 2016. 
• The credit union system’s net worth ratio was 10.80 percent in the second quarter of 2017, compared with 10.85 percent one year earlier. 
• Net income totaled $10.2 billion at an annual rate in the second quarter of 2017, up $0.65 billion, or 6.8 percent, from the same period a year ago.
• The net interest margin for federally insured credit unions was $38.7 billion in the second quarter of 2017, or 2.9 percent of average assets.
• The return on average assets for federally insured credit unions was 77 basis points over the year ending in the second quarter of 2017, unchanged from the second quarter of 2016. The median return on average assets across all federally insured credit unions was 36 basis points, up slightly from 35 basis points in the second quarter of 2016.
• The number of federally insured credit unions declined to 5,696 in the second quarter of 2017 from 5,887 in the second quarter of 2016. In the second quarter of 2017, there were 3,568 federal credit unions and 2,128 federally insured, state-chartered credit unions. The year-over-year decline is consistent with long-running industry consolidation trends.
• The number of credit unions with a low-income designation rose to 2,524 in the second quarter of 2017 from 2,426 one year earlier.
• Federally insured credit unions added 4.5 million members over the year, and credit union membership in these institutions reached 109.3 million in the second quarter of 2017.

Balance Sheet Details       

Assets

• Total assets in federally insured credit unions rose by $96 billion, or 7.7 percent, over the year to $1.35 trillion in the second quarter of 2017.
• Cash and equivalents (assets with maturity of three months or less) rose $3.1 billion, or 3.1 percent, to $104.5 billion.
• Total investments (instruments with maturities in excess of three months) increased nearly $3.0 billion, or 1.1 percent, to $274.8 billion.
  • Investments with maturities of less than one year rose $3.7 billion, or 5.0 percent, to $77.7 billion.
  • Investments with maturities of one to three years declined $13.5 billion, or 13.0 percent, to $90.2 billion.
  • Investments with maturities of three to five years increased $5.2 billion, or 7.9 percent, to $70.6 billion.
  • Investments with maturities of five to 10 years were up $7.0 billion, or 28.1 percent, to $31.9 billion.
  • Investments with maturities greater than 10 years rose $0.6 billion, or 15.1 percent, to $4.5 billion.
• Total loans outstanding increased $90 billion, or 10.9 percent, over the year to $913.0 billion. Credit union loan balances rose over the year in every major category, compared with the second quarter of 2016.
  • Real estate loans rose $39.8 billion, or 9.7 percent, over the year to $451.0 billion in the second quarter of 2017.
  • Auto loans increased $38.0 billion, or 13.6 percent. Used auto loans rose $20.5 billion, or 11.9 percent, to $193.5 billion. New auto loans rose $17.5 billion, or 16.3 percent, to $124.7 billion.
  • Net member business loan balances, including unfunded commitments, increased $10.8 billion, or 17.4 percent, to $72.5 billion in the second quarter.
  • Credit card balances rose $4.0 billion, or 8.2 percent, to $53.1 billion.
  • Non-federally guaranteed student loans rose $0.4 billion, or 12.1 percent, to $4.1 billion.
• The delinquency rate at federally insured credit unions was 75 basis points in the second quarter of 2017, unchanged from one year earlier. Loan performance was mixed across categories:
  • The delinquency rate on fixed real estate loans was 47 basis points in the second quarter, down from 55 basis points one year earlier.
  • The credit card delinquency rate was 108 basis points, up from 93 basis points in the second quarter of 2016.
  • For auto loans, the delinquency rate was 59 basis points in the second quarter of 2017 compared with 58 basis points one year earlier.
  • The delinquency rate for member business loans stood at 171 basis points, up from 150 basis points in the second quarter of 2016.
• The net charge-off ratio for all federally insured credit unions was 57 basis points in the second quarter of 2017, up from 51 basis points in the second quarter of 2016.  

Liabilities and New Worth

• Credit union shares and deposits rose by $86.6 billion, or 8.2 percent, over the year to $1.15 trillion in the second quarter of 2017. Regular shares rose $45.7 billion, or 12.2 percent, to $419.2 billion. Other deposits increased $29.5 billion, or 5.6 percent, to $560.5 billion, led by money market accounts, which rose $17.1 billion, or 7.1 percent, and share certificate accounts, which were up $9.3 billion, or 4.7 percent.
• The credit union system’s net worth increased by $9.7 billion, or 7.1 percent, over the year to $145.9 billion. The aggregate net worth ratio – net worth as a percentage of assets – stood at 10.80 percent in the second quarter of 2017 compared with 10.85 percent one year earlier.

Income Statement Details

• Net income for federally insured credit unions in the second quarter of 2017 totaled $10.2 billion at an annualized rate, up $0.6 billion, or 6.8 percent, from the second quarter of 2016. Interest income rose $4.1 billion, or 9.8 percent, over the year to $45.8 billion, and non-interest income increased $1.0 billion, or 5.8 percent, to $17.5 billion.
• Interest expense totaled $7.0 billion annualized in the second quarter of 2017, up $0.7 billion, or 11.6 percent, from one year earlier. Non-interest expenses grew $2.4 billion, or 6.4 percent, over the year to $40.4 billion in the second quarter. Rising labor expenses, which were up $1.4 billion, or 7.3 percent, accounted for more than half of the increase in non-interest expenses.
• The aggregate net interest margin widened $3.3 billion over the year, or 9.5 percent, to $38.7 billion at an annual rate in the second quarter of 2017.
• The credit union system’s provision for loan and lease losses rose $1.2 billion over the year, or 27.5 percent, to $5.7 billion at an annual rate in the second quarter of 2017.

Performance by Asset Category

Consistent with long-running trends, credit unions with assets of at least $1 billion reported the strongest growth in loans, membership and net worth over the year ending in the second quarter of 2017. Credit unions with less than $50 million in assets reported declines in loans, membership and net worth over the year.

• The number of federally insured credit unions with assets of at least $1 billion increased from 265 in the second quarter of 2016 to 282 in the second quarter of 2017. These 282 credit unions held $844.7 billion in assets, or 63 percent of total system assets. Credit unions in this category reported loan growth of 15.1 percent. Membership rose 9.8 percent. Net worth increased 11.7 percent.
• The number of federally insured credit unions with assets of at least $500 million but less than $1 billion increased from 229 in the second quarter of 2016 to 238 in the second quarter of 2017. These 238 credit unions held $167.9 billion in total assets, or 12.4 percent of total system assets. Credit unions in this category reported loan growth of 7.9 percent. Membership increased 1.8 percent. Net worth increased 3.7 percent.
• The number of federally insured credit unions with at least $100 million but less than $500 million in assets declined from 1,048 in the second quarter of 2016 to 1,046 in the second quarter of 2017. These 1,046 credit unions held $234.2 billion in total assets, or 17 percent of total system assets. Credit unions in this category reported loan growth of 2.7 percent. Membership declined 2.0 percent. Net worth was unchanged from the second quarter of 2016.
• The number of federally insured credit unions with at least $50 million but less than $100 million in assets increased from 721 in the second quarter of 2016 to 732 in the second quarter of 2017. These 732 credit unions held $52.2 billion in total assets, or 3.9 percent of total system assets. Credit unions in this category reported loan growth of 2.4 percent. Membership declined 1.5 percent. Net worth increased 0.5 percent.
• The number of federally insured credit unions with assets of at least $10 million but less than $50 million declined from 1,901 in the second quarter of 2016 to 1,813 in the second quarter of 2017. These credit unions held $45.1 billion in assets, or 3.0 percent of total system assets. Credit unions in this category reported a 4.5 percent decline in loans. Membership declined 7.7 percent. Net worth declined 5.5 percent.
• The number of federally insured credit unions with less than $10 million in assets declined from 1,723 in the second quarter of 2016 to 1,585 in the second quarter of 2017. These credit unions held $6.6 billion in assets, or less than 1.0 percent of total system assets. Credit unions in this category reported a 7.3 percent decline in loans. Membership fell 10.6 percent. Net worth declined 7.1 percent.