Credit Cards Issued by Credit Unions Are Performing Well
Credit union loan growth may be stagnating, but CU credit card portfolios continued to grow in second-quarter 2010, according to a card analytical firm.
Asset Exchange, a brokerage and consultant that is a subsidiary of card processor FIS, reported that NCUA data show CU card balances at CUs with card portfolios worth at least $1 million grew at an annual rate of 7.4% between June 2009 and June 2010 to $34 billion. This continued the trend of CU cards as among the leading CU loan products and outperforming other loan products. Total assets at these credit unions grew at an annual rate of 6.8% over the same period, the firm reported.
This meant that credit cards as a percentage of total assets increased slightly to 4.6% in second-quarter 2010, up from 4.5% in second-quarter 2009.
Significantly, card accounts grew at a 3.1% annual rate over the same period to $12.6 million, the firm said.
But the news was not all good. Credit union card charge-offs rose to 4.5%, an industry high, but card delinquencies fell to 1.7%, suggesting that charge-off numbers may drop as well.