NCUA Calculates More Than 12% Loan Growth Annualized

ALEXANDRIA, Va.-Credit unions are showing tremendous growth in lending while maintaining strong asset quality, according to newly released NCUA third quarter data. As of Sept. 30, 2005, federally insured credit unions’ loan growth stood at 9.1%, which NCUA calculated out to 12.1% annualized. NAFCU Senior Economist Jeff Taylor, who had previously predicted 10.5% loan growth by year-end, said he may be revising his forecast. “Between 11 and 12% is probably about right,” he said. Real estate and vehicle loans continued to lead the way. At the same time, delinquencies are very low at 0.67%, down from 0.72% at year-end 2004. Net charge-offs have been consistent at 0.52%. The loan-to-share ratio climbed to 78.3% percent as loan growth of $17.3 billion in the third quarter pushed the year-to-date increase in loans to $37.5 billion. Share growth, on the other hand, has been particularly weak, increasing just 3.8% to $577.1 billion. (See related story page 22.) Credit union earnings held their own at 0.93% annualized. Investments fell 3.26% while their yields improved to push net worth growth up 8.6% and increased the overall net worth ratio to 11.15%. The 8,795 federally insured credit unions held assets of $677 billion as of the end of the third quarter, up 4.6%. “I commend America’s federally insured credit unions for their solid performance in the third quarter,” NCUA Chairman JoAnn Johnson said. “The consistent strong performance reflects a robust economy and the good work of the nation’s credit unions in extending access to affordable financial services.” The consolidated balance sheet for NCUA-insured credit unions is available online at http://www.ncua.gov/data/ FOIA/foia.html. The third quarter data had been delayed because of the credit unions hit by Hurricanes Katrina and Rita. -