CREDIT UNIONS ENDED 2011 IN A SAFER, STRONGER POSITION (FROM PAGE 1)
Industry Earnings Improve
The industry’s return on assets (ROA) ratio, a measure of
earnings, stood at 68 basis points at the end of 2011, up 18
basis points from the year-end 2010 ROA and 2 basis points
from the prior quarter. Industry ROA has increased 50 basis
points since December 2009.
Loans Grow for Third
Consecutive Quarter
Credit unions steadily increased lending throughout the last
three quarters of 2011. Total loans by year-end 2011 reached
$571.5 billion, up 1. 2 percent over 2010. Nearly two-thirds
of the 2011 lending growth (0.79 percent) occurred during
the fourth quarter as the economic recovery strengthened.
For the quarter, consumer lending grew by $3.3 billion for
first home mortgages, $1.5 billion for unsecured credit cards,
and $1 billion for used cars. Business lending also rose to
$39.1 billion on Dec. 31, a 1. 7 percent increase for the
quarter and 5.2 percent for the year.
Demand for non-federally guaranteed student loans grew by
10. 1 percent during the last quarter. Finally, demand for
credit union short-term small loans—a consumer-friendly
alternative to payday loans—surged 40.3 percent in the
fourth quarter.
Deposit growth at credit unions has outpaced loan growth in recent
years. As a result, the industry’s loan-to-deposit ratio has dropped.
Deposits Rise More Rapidly
Deposits continued to grow faster than lending. As a result,
the industry’s loan-to-share ratio declined to 69.07 percent,
down 14 basis points in the fourth quarter and 2. 7 percentage
points year-to-year. Total savings at credit unions reached
$827.4 billion, an increase of $8.2 billion in the fourth
quarter and $41 billion for the year. In the fourth quarter,
money market funds expanded by $4 billion, regular shares
rose by $3.6 billion, share drafts increased $1.4 billion, and
retirement accounts grew $138 million. Share certificates,
however, fell by $609 million.
Delinquencies and Charge-Offs Constant
Credit unions reported a loan delinquency ratio of 1.60
percent for the fourth quarter. The ratio represents a slight 1
basis point increase over the third quarter, but a drop of 16
basis points from a year earlier. The net charge-off ratio
during the quarter stayed constant at 0.91 percent.
New Bankruptcy Filings Fall Again
New bankruptcy filings by credit union members continued
to drop. In the fourth quarter, credit unions reported 52,852
members filing for bankruptcy, a 6. 4 percent decline
compared to the third quarter. Members filing bankruptcy in
2011 totaled 274,765, a decline of 17.8 percent from 2010.
The percentage of loans charged off due to bankruptcy fell
by 11 basis points during the last quarter to 23.83 percent of
charged-off loans. Compared to the third quarter, total
charge-offs due to bankruptcy increased at a slower rate in
the fourth quarter. The amount of loans charged off due to
bankruptcy declined 16.7 percent in 2011 compared to the
prior year.
Key Indicators Improve
Year over year, key balance sheet and income statement data
from federally insured credit unions improved:
; Net worth increased 6. 9 percent to $98.4 billion from
$92.0 billion;
; Assets increased 5.2 percent to $961.8 billion from $914.3
billion;
; Shares increased 5.2 percent to $827.4 billion from $786.4
billion;
;Investments, cash on deposit, and cash equivalents
increased 12.4 percent to $352.1 billion from $313.3
billion;
; Loans increased 1. 2 percent to $571.5 billion from $564.7
billion; and
; Net income increased 41.2 percent to $6.4 billion from
$4.5 billion.
NCUA makes the complete details of December 2011 Call
Report data available online at: http://go.usa.gov/URs.
