While Kentucky credit unions are performing higher than the national average in a number of areas, the cooperatives were challenged by CUNA Mutual Group to seek out more growth strategies.
That was the message from Scott Powell, managing director, general account investments for MEMBERS Capital Advisors, the registered investment advisor for CUNA Mutual. On Oct. 22, Powell spoke at the Kentucky Credit Union League Annual Meeting and Convention.
Kentucky CUs have been performing at a higher level than the national average in almost all financial measures, but margins are still tight and continue to shrink, according to CUNA Mutual. A looming second credit crisis, a second wave of unemployment shock and potential inflationary spikes down the road are still risks.
"Consumers will continue to struggle with job loss and underemployment," Powell said. "As a result, we anticipate American households will be engaged in significant de-leveraging - paying down debt, dealing with defaults and bankruptcies, and generally be risk averse in spending and investing their limited discretionary dollars."
Powell said CUs will need to be more aggressive to grow their loan business as organic lending will not grow as quickly as in the past.
"If you want to achieve lending growth - go get it. You need to develop highly targeted, value-added lending programs to higher-quality credits within your member profile to build the asset side of your balance sheet," Powell said.