CUNA Mutual Group reports ‘modest’ growth in CU memberships, growing balances

In its September 2020 Credit Union Trends Report, based on data from July, the fourth full month of the COVID-19 pandemic, CUNA Mutual Group reported that credit unions picked up 327,000 in new memberships, loan balances grew at a 4.9% seasonally adjusted annualized rate and savings balances grew 26.2%.

Credit union memberships rose “a modest” 0.26% in July, below the 0.36% gain reported in July 2019, while memberships are up 2.9% over the past year due to modest job creation and demand for used auto loans and real estate loans, according to the report.

Credit unions also increased their loan portfolios by 0.7% in July, more than the 0.6% pace reported in July 2019, and 6.5% during the last 12 months, with the report noting that July is historically the third-fastest loan growth month in the year.

The report also found that:

  • the economy gained 1.734 million jobs;
  • the unemployment rate decreased to 10.2%;
  • personal income rose 0.4%;
  • personal spending rose 1.9%;
  • consumer prices rose 0.6%;
  • consumer confidence fell;
  • new home sales rose 13.9%;
  • existing home sales rose 24.7%;
  • auto sales rose 18.1%;
  • home prices rose 1.2%; and
  • the 10-year Treasury interest rate decreased 11 basis point to average 0.62%.

The August report also includes CUNA Mutual Group’s latest economic forecast, with the economy expanding at a 25% annualized pace in the third quarter (7% non-annualized pace) and 5% in the fourth quarter. The report says to expect the unemployment rate to end 2020 at 7.5% and end 2021 at 6.5%.

Additionally, the Federal Reserve is expected to keep the fed funds interest rate at 0.1% until inflation rises above its 2% target for a couple years, while the 10-year Treasury interest rate is expected to remain below 1% until 2022 due to low inflation expectations and massive quantitative easing, according to the report.

To view the full report, click here.

The Credit Union Trends Report is a monthly “pulse check” on the state of the credit union marketplace, often placed in a historical context. The report includes data from two months prior and is published and distributed by Steven Rick, chief economist for CUNA Mutual Group. The Trends Report is intended to provide a review and analysis of recent credit union financial performance and operational results in the context of recent economic activity. Data and analysis are provided to establish standards against which credit unions’ own performance can be compared.

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