Tuesday, May 27, 2008

NCUA: Share growth surges in first quarter

ALEXANDRIA, Va. (5/27/08)--Federally insured credit unions reported significant share growth in the first three months of 2008, the National Credit Union Administration (NCUA) said Thursday.

The data were taken from NCUA's Call Report, which is based on data submitted by the nation's 8,049 federally insured credit unions.

Total shares increased 5.6%, for an annualized 22.4% in the first quarter. Every category of savings, except non-member deposits, grew by annualized double digits. Loan growth was 1.1%, or an annualized 4.5%.

"The influx of shares in the first quarter illustrates that credit unions are providing their members with competitive savings products," said NCUA Chairman JoAnn Johnson in a statement. "Federally insured credit unions reported a 4.8% increase in first-mortgage real estate loans in the first three months of 2008."

Net charge-offs increased to 0.67% from 0.50%, resulting in the loan delinquency ratio declining from 0.93% to 0.91%.

The data indicate adverse real estate delinquency trends, Johnson said. But the trends are not indicative of systemic problems in the overall safety, soundness and stability of the credit union industry, she added.

"(The trends) underscore the importance of proactivity, diligence and care in credit union underwriting and management of real estate loan portfolios," Johnson said.

Other findings from the report:
  • Assets increased 5.1% to $792.2 billion from $753.4 billion;
  • Loans rose 1.1% to $532.8 billion from $526.9 billion;
  • Investments were up 8.5% to $154.6% from $142.5 billion;
  • Shares increased 5.6% to $667.7 billion from $632.4 billion;
  • Net worth went up 1.8 % to $87.7 billion from $86.2 billion; and
  • Membership rose 0.8% to 87.5 million members

In large lending categories:

  • Total real estate loans increased 3.1% to $279.6 billion;
  • Used-auto loans increased 0.7% to $89.7 billion;
  • New-auto loans declined 3.2% to $84.1 billion; and
  • Unsecured credit card loans declined 1.2% to $29.7 billion.

With the exception of first-mortgage real estate loans, lending was curtailed during the quarter, and the influx of shares resulted in several investment categories expanding significantly, NCUA noted in its statement. Available-for-sale securities increased 16.9 % to $67.9 billion, and deposits in commercial banks, savings and loans, and savings banks grew 27.7% to $21.0 billion.

Regarding share growth:

  • Money market shares grew 7.9% to $119.9 billion;
  • Share drafts grew 6.9% to $75.8 billion;
  • Regular shares grew 5.1% to $177.6 billion;
  • Share certificates grew 4.6% to $226.1 billion; and
  • Individual retirement accounts and Keogh accounts were up 4.2% to $59.3 billion for the quarter.

The return on average assets ratio declined to 0.60% from 0.64% at year-end 2007 because of an increase in the provision for loan and lease losses expense from 0.44% to 0.55% as credit unions account for potential loan losses, the NCUA said.

Details of first-quarter 2008 data are available in a consolidated balance sheet and a March 2008 Facts/Summary posted online. For more information, use the link.

courtesy of cuna.org

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