As credit unions continue to weather the economic storm, it may take achieving economies of scale and scope to reassure members that their financial institutions will remain healthy for the long term. Along with that assessment, CUNA Mutual Group Chief Economist Dave Colby said it will take years, "if ever," for capital to recover to prerecession levels. Revenue sources, both spread and nonspread income, will be lower and expenses will rise, he added. "We believe the next six months will be a period of wait and see for consumers and businesses alike," Colby said. "A sustained recovery will not be assured until we see the employment picture improve for several months and the global credit markets begin to function normally." As for how all of these factors will impact membership growth, the combination of more mergers and tighter expense controls may put the brakes on long-term development, Colby said. According to the September edition of CUNA Mutual Group's "Credit Union Trends Report," total membership reached 92 million at the end of July. Like 2008, year-to-date membership is up 1.2 million. However, unlike last year, CUNA Mutual does not expect the steep decline in the second half of this year. Colby is forecasting a total increase of 1.2 million members in 2009 followed by an average annual increase of 812,000 over the next three years. Meanwhile, 51% of all credit unions, or a total of 3,987, reported declines in membership from mid-year 2008 to mid-year 2009, according to the data. Colby said these credit unions represent 26% of the movement's assets, which includes 31 billion-dollar credit unions. The top 500 credit unions, which account for 6.4% of cooperatives in the industry, held 56% of all members by the middle of the year. On the other end of the spectrum, the smallest 5,000 credit unions or 64% all credit unions, held just 10% of membership. "We may have reached the bottom of our current recession, but the road to recovery will be uneven. The Cash for Clunkers and first-time homebuyers tax credit programs are intended to be pump priming and should not be extrapolated forward as trends." It is probably a given that credit unions will continue with mergers as the economy pushes toward recovery. Colby said, based on the NCUA's reports and announced mergers, the rate of industry consolidation will likely be revised higher and this trend is forecast to continue over the next few years. –[email protected]