Schenk: Loan Growth Could Equal Deposit Growth in 2013
Financial trends show that parity between loan and deposit growth is slowing returning to credit unions, according to CUNA.
November’s numbers don’t tell that story, however. The month brought a big deposit gain – 1.3% in November alone - thanks to Nov. 30 falling on a payday Friday. Loans outstanding fell slightly, less than 0.1% during November, driven by a 1.3% decrease in fixed rate mortgages, while other loan categories grew, the trade group said.
Despite the November hiccup, loans outstanding have increased 3.9% year-to-date as of Nov. 30, compared to a 6.4% increase in savings during the same period. That’s a vast improvement over financials one year prior, when loans had only posted 0.7% growth as of Nov. 30, 2011 compared to 4.0% deposit growth. Deposit growth far outpaced loan growth in 2010 and 2009, as well.
CUNA Economist Mike Schenk said he expects 2012 year-end loan growth numbers to be between 4% and 4.5%, and savings growth to be around 5%. And, in 2013, Schenk said he’s hopeful credit unions will see loans and savings grow equally, between 5% and 5.5%.
The economist also said 2012 year-end numbers should also show membership increased by approximately 2.2% and return on assets will be around 80 basis points.