Despite four consecutive years of vehicle loan portfoliodeclines at credit unions, used vehicle lending continues to be abeacon of light for the industry.
|In 2010, used vehicle loans increased 4.1%, according to CUNAMutual Group's February Credit Union Trends Report. This $4.1billion gain added to bottom-line results as the average ratecharged in 2010 was 5.4%, well above its investment alternative.Small growth improvements are forecast for 2011, the report's datashowed.
|Meanwhile, the new vehicle loan portfolio declined $1.1 billionin December with the total 2010 reduction coming in at $12.6billion or 16.4%. This is four years of retrenchment for thisportfolio segment, according to CUNA Mutual Chief Economist DaveColby.
|The 4.8% annual decline in overall auto lending translates intoa net reduction of $8.5 billion in loans. At $168.3 billion, Colbysaid this key loan portfolio segment is down $14.4 billion or 7.9%from its peak in September 2007.
|"January 2011 sales data and showroom traffic numbers areencouraging, but we continue to believe credit unions' near-termshare of new vehicle financing will be limited," Colby said.
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