Card Portfolio Market Remains Weak, Analysis Shows
An analysis of call report data indicates that only two more credit unions recently sold their credit card portfolios and entered into an agent issuing program with the purchasing banks, according to Tim Kolk, president of TRK Advisors, a CU card portfolio brokerage and consultancy.
Kolk reported that according to NCUA data, seven credit unions had sold their credit card portfolios so far this year as of the end of the third quarter. The two sold in the third quarter represented balances of roughly $23 million, taking the year to date total balances sold to $85 million.
This puts the likely total balances sold for this year at likely over $100 million for the first time since 2009, but the market remains a mere shadow of its heyday between 2004 and 2007, Kolk said.
“Sales volumes are expected to remain below the high water marks of 2004-2007 when over 60 portfolios per year were sold. It is uncertain if sales will rebound further from current levels,” Kolk wrote in his analysis.
“Potential sellers continue to evaluate the strategy and benefits of such sales, but the desire to generate loan volume and put to use excess liquidity lead many to determine that sale is not prudent at this time,” he wrote.