ARLINGTON, Va. — Credit union card portfolio analysts and brokers report that their analysis of NCUA's most recent data shows CU card performance continues to rise this year as CU card portfolio sales steadily decline.
The agency's third quarter data on CU financial performance indicated that 2,100 credit unions have credit card portfolios worth more than $1 million, according to an analysis of the data performed by Asset Exchange, a card consulting and brokerage firm that is owned by Fidelity National Information Services.
Most of the numbers have been very good. Since Sept. 2006, the firm reported that the average balance on a CU-issued credit card account has risen 11% to $2,347. Given this increase, it may not be surprising that this year has seen 70% of CU card portfolios grow faster than the rate of inflation, up from 60% this time last year.
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Total card assets in the industry grew almost 14%, from $24.2 billion this time last year to $27.5 billion in 2007 and credit card assets increased as a percentage of total CU assets from 4.34% in Sept. 2006 to $4.67% this year.
The one perennial weak point remained penetration with percentage of credit union members who have their CU's credit card hovering at just under 20%, though this number also showed a slight uptick in Asset Exchange's analysis.
The increased card performance has occurred at the same time that card portfolio sales have been slowing, the data showed. Analysis from both Asset Exchange and Brookwood Capital, a leading CU card portfolio broker show CU card portfolio sales down for the year thus far.
Asset Exchange's data showed 12 portfolios sold in the third quarter of this year, while Brookwood showed 11, each acknowledging that the numbers were down. Asset Exchange did not carry a year-to-date figure on how many portfolios sold, but Brookwood reported the number at 47. Last year, for the whole year, approximately 69 or 70 CUs sold their card portfolios and Asset Exchange reported that the third quarter sales in terms of numbers of portfolios sold were off 15% compared to last year.
Each firm also acknowledged that the volumes of card portfolios sold have been lower as well, with volume off 70% in the third quarter of this year compared to the third quarter of 2006. Brookwood Capital, however, tried to put a better face on the numbers from a broker's point of view, pointing out that the end of the year had not yet been seen.
"Overall, year-to-date results put credit union portfolio sales slightly below the results of the past several years, though last year's fourth quarter saw heavy sales volume. Similar trends this year could result in sales results which end up being consistent from year-to-year, but that will not be known for another three months," Brookwood said in a commentary that accompanied the release of its analysis.
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