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NCUA releases Q1 2017 performance data

Thu, Jun 8, 2017

Data on the financial performance of federally insured credit unions in the quarter ending March 31, 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 $97 billion, or 7.8 percent, over the year to $1.34 trillion in the first quarter of 2017.
  • Total loans outstanding increased $85 billion, or 10.6 percent, over the year to $884.6 billion. The average outstanding loan balance in the first quarter of 2017 was $14,497, up $674, or 4.9 percent, from one year earlier.
  • The delinquency rate at federally insured credit unions was 69 basis points in the first quarter of 2017, little changed from 71 basis points one year earlier. The net charge-off ratio was 58 basis points, up from 52 basis points in the first quarter of 2016.
  • Insured shares and deposits rose $78 billion, or 7.8 percent, over the four quarters ending in the first quarter of 2017 to $1.1 trillion.
  • The loans-to-shares ratio stood at 77.7 percent in the first quarter of 2017, up from 76.1 percent in the first quarter of 2016.
  • The credit union system’s net worth ratio was 10.70 percent in the first quarter of 2017, compared with 10.78 percent one year earlier.
  • Net income totaled $9.4 billion at an annual rate in the first quarter of 2017, up $0.2 billion, or 2.6 percent, from the same period a year ago.
  • The net interest margin for federally insured credit unions was $38.0 billion in the first quarter of 2017, or 2.9 percent of average assets.
  • The return on average assets for federally insured credit unions was 71 basis points for the first quarter of 2017, little changed from 75 basis points in the first quarter of 2016. The median return on average assets across all federally insured credit unions was 33 basis points, unchanged from the first quarter of 2016.
  • The number of federally insured credit unions declined to 5,737 in the first quarter of 2017 from 5,954 in the first quarter of 2016. In the first quarter of 2017, there were 3,584 federal credit unions and 2,153 federally insured, state chartered credit unions. The year-over-year decline is consistent with long-running industry trends.
  • The number of credit unions with a low-income designation rose to 2,518 in the first quarter of 2017 from 2,348 one year earlier.
  • Federally insured credit unions added 4.3 million members over the year, and credit union membership in these institutions reached 108.0 million in the first quarter of 2017.

Balance Sheet Details

Assets

  • Total assets in federally insured credit unions rose by $97 billion, or 7.8 percent, over the year to $1.34 trillion in the first quarter of 2017.
  • Cash and equivalents (assets with maturity of three months or less) rose $7.5 billion, or 6.6 percent, to $121.1 billion.
  • Total investments (instruments with maturities in excess of three months) increased $3.1 billion, or 1.1 percent, to $275.5 billion.
    • Investments with maturities of less than one year rose $7.0 billion, or 10.0 percent, to $77.2 billion.
    • Investments with maturities of one to three years declined $12.9 billion, or 12.4 percent, to $90.6 billion.
    • Investments with maturities of three to five years increased $2.3 billion, or 3.3 percent, to $69.5 billion.
    • Investments with maturities of five to 10 years were up $6.9 billion, or 25.4 percent, to $33.9 billion.
    • Investments with maturities greater than 10 years edged down $0.2 billion, or 3.6 percent, to $4.3 billion.
  • Total loans outstanding increased $85.1 billion, or 10.6 percent, over the year to $884.6 billion. Credit union loan balances rose over the year in every major category, compared with the first quarter of 2016.
    • Auto loans increased $37.0 billion, or 13.7 percent. Used auto loans rose $20.0 billion, or 12.0 percent, to $186.8 billion. New auto loans rose $17.0 billion, or 16.5 percent, to $120.0 billion.
    • Real estate loans rose $36.7 billion, or 9.1 percent, over the year to $438.9 billion in the first quarter of 2017.
    • Net member business loan balances, including unfunded commitments, increased $9.1 billion, or 15.3 percent, to $68.9 billion in the first quarter.
    • Credit card balances rose $3.7 billion, or 7.8 percent, to $51.6 billion
    • Non-federally guaranteed student loans rose $0.4 billion, or 9.8 percent, to $4.0 billion.
  • The delinquency rate at federally insured credit unions was 69 basis points in the first quarter of 2017, little changed from 71 basis points one year earlier. Loan performance was mixed across categories:
    • The delinquency rate on fixed real estate loans was 38 basis points in the first quarter, down from 49 basis points one year earlier.
    • The credit card delinquency rate was 109 basis points, up from 95 basis points in the first quarter of 2016.
    • For auto loans, the delinquency rate was 57 basis points in the first quarter of 2017 compared with 54 basis points one year earlier.
    • The delinquency rate for member business loans stood at 161 basis points, up from 141 basis points in the first quarter of 2016.
  • The net charge-off ratio for all federally insured credit unions was 58 basis points in the first quarter of 2017, up from 52 basis points in the first quarter of 2016.

Liabilities and New Worth

  • Credit union shares and deposits rose by $87.1 billion, or 8.3 percent, over the year to $1.14 trillion in the first quarter of 2017. Regular shares rose $45.8 billion, or 12.4 percent, to $416.5 billion. Other deposits increased $30.7 billion, or 5.9 percent, to $555.5 billion, led by money market accounts, which rose $18.2 billion, or 7.7 percent, and share certificate accounts, which were up $8.5 billion, or 4.4 percent.
  • The credit union system’s net worth increased by $9.3 billion, or 6.9 percent, over the year to $143.1 billion. The aggregate net worth ratio – net worth as a percentage of assets – stood at 10.70 percent in the first quarter of 2017 compared with 10.78 percent one year earlier.

Income Statement Details

  • Net income for federally insured credit unions in the first quarter of 2017 totaled $9.4 billion at an annualized rate, up $0.2 billion, or 2.6 percent, from the first quarter of 2016. Interest income rose $3.5 billion, or 8.5 percent, over the year to $44.8 billion, and non-interest income increased $0.9 billion, or 5.6 percent, to $16.9 billion.
  • Interest expense totaled $6.8 billion annualized in the first quarter of 2017, up $0.6 billion, or 9.3 percent, from one year earlier. Non-interest expenses grew $2.4 billion, or 6.3 percent, over the year to $39.9 billion in the first quarter. Rising labor expenses, which were up $1.5 billion, or 7.5 percent, accounted for more than half of the increase in non-interest expenses.
  • The aggregate net interest margin widened $2.9 billion over the year, or 8.3 percent, to $38.0 billion at an annual rate in the first quarter of 2017.
  • The credit union system’s provision for loan and lease losses rose $1.2 billion over the year, or 27.8 percent, to $5.6 billion at an annual rate in the first quarter of 2017.

Performance by Asset Category

  • Consistent with long-running trends, credit unions with assets greater than $1 billion reported the strongest growth in loans, membership and net worth over the year ending in the first 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 credit unions with assets greater than $1 billion increased from 263 in the first quarter of 2016 to 278 in the first quarter of 2017. These 278 federally insured credit unions held 62 percent of total system assets. Loan growth was 14.7 percent over the year. Membership rose 9.8 percent. Net worth increased 11.3 percent.
  • The number of credit unions with more than $100 million but less than $500 million in assets rose from 1,047 in the first quarter of 2016 to 1,053 in the first quarter of 2017. These credit unions reported loan growth of 2.9 percent over the year ending in the first quarter of 2017. At the end of the first quarter of 2017, the 1,053 federally insured credit unions in this category held $235 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 first quarter of 2017 to 3,436 from 3,682 in the first quarter of 2016. These credit unions accounted for 4 percent of total system assets in the first quarter of 2017.
  • Credit unions with $10 to $50 million in assets reported a 4.5 percent decline in loans, an 8.3 percent decline in membership, and a 5.7 percent decline in net worth. There were 1,828 credit unions in this category in the first quarter of 2017, down from 1,927 in the first quarter of 2016.
  • For credit unions with less than $10 million in assets, loans declined 6.7 percent, membership fell 10.8 percent, and net worth declined 7.1 percent. The number of credit unions in this category declined from 1,755 in the first quarter of 2016 to 1,608 in the first quarter of 2017.

About NCUA

NCUA is the independent federal agency created by the U.S. Congress to regulate, charter and supervise federal credit unions. With the backing of the full faith and credit of the United States, NCUA operates and manages the National Credit Union Share Insurance Fund, insuring the deposits of nearly 105 million account holders in all federal credit unions and the overwhelming majority of state-chartered credit unions. At MyCreditUnion.gov and Pocket Cents, NCUA also educates the public on consumer protection and financial literacy issues.