Callahan: CU Assets Top $1 Trillion; Net Members and Mortgage Loans Also Grow in 1Q2012
First quarter 2012 savings and checking deposits posted double-digit growth, and the number of checking accounts increased 7.9%.
Credit unions didn’t just gain deposits in the first quarter, they gained members, too: net new members increased 2.1%, up from fourth quarter 2011’s record 1.7%.
The good news spilled over to the assets side of the balance sheet, as well, Cole reported. Credit unions included in Callahan’s FirstLook data reported the highest volume of first quarter loan originations on record, up 26% from first quarter 2011.
First mortgage originations comprised 34.2% of the total loan volume. Credit unions sold 50.4% of those originations to the secondary market. Even with the sales, credit unions posted loans outstanding growth, up 2.5% from March 2011 levels.
Consumer loan originations as a percentage of total loan volume dropped, however, to 55.6% during first quarter 2012, down from a peak of 63.4% in September 2011.
Delinquency is down 16 basis points to 1.42% and the charge-off ratio, which traditionally increases from the fourth to the first quarters, dropped 10 basis points to 0.85%.
The net interest margin dropped 15 basis points from 3.24% in December to 3.09% through March, due to members paying down higher-rate loans and credit unions replacing them with loans at lower rates.
However, despite the drop in net interest income, the increase in mortgage lending and other non-interest income sources drove total income up 62 basis points. The last time credit unions posted positive year-over-year growth in total income was September 2009.
With positive growth in total income and improving asset quality, which produced a 20.2% drop in year-to-date provision expenses, earnings are a high point for FirstLook credit unions.
They posted an annualized year-to-date ROA of 0.87% after stabilization expenses, up 20 basis points from December’s level of 0.67% and up 11 basis points from the previous March.
The capital ratio for the industry stands at 11.1%, which is unchanged from the previous March, but indicates an increase in reserves due to asset growth.