Consumer Credit Expands, But Not for Credit Unions … Or Banks
March consumer credit figures posted the largest gain in 10 years, but credit unions – as well as commercial banks and financial companies – experienced a reduction in consumer lending, according to a NAFCU release.
Despite a 10.2% increase in total consumer installment credit to a seasonally adjusted $2.5 trillion, credit unions lost $0.8 billion, falling to $223 billion, the NAFCU report released this week said.
Total non-revolving credit increased at an annual rate of 11.3% to $1.74 trillion, while revolving credit increased by 7.7% to $803.6 billion. Comparatively, for credit unions, revolving credit market share decreased to 4.61% during March to $36.4 billion, while non-revolving credit declined to 10.77% to $186.6 billion as of March 31.
Commercial banks also experienced a slip in consumer credit, losing $1.6 billion from February month-end to March and reporting $1.075 trillion. Finance companies lost $1.3 billion during March, falling to $497.8 billion.
The big winners are in the “other” category, which includes the federal government, savings institutions, non-financial business and pools of securitized assets. The other category experienced an increase of $81 billion during the month of March, climbing to $726.5 billion.
According to NAFCU research, gains in student loans are responsible for much of the increase, which falls under government lending. Government-backed student loans have increased from $100 billion in 2008 to nearly $500 billion as of March 2012, and experienced a large uptick during the first quarter.