An increasing number of executives are pessimistic about the2013 outlook for their credit unions because of more regulations,low interest rates and a weak economic recovery, according to a Websurvey of 271 credit union leaders by Abound Resources, an Austin,Texas-based management consulting firm.

The survey found that 25% of credit union executives are eithersomewhat or very pessimistic. Last year, the Abound Resourcessurvey found only 16% of credit union executives were eithersomewhat or very pessimistic in 2012.

“CEOsare clearly frustrated with the cost and hassle of regulationscoming out of Washington and are fearful of future developmentsfrom the Consumer Financial Protection Bureau,” the survey reportstates. “The sluggish economic recovery also weighs heavily on theminds of CEOs, but, in our conversations with clients, it's theregulatory burden and the fear of the unknown that is keeping themup at night.

“The realization that the Dodd-Frank Act and the ConsumerFinancial Protection Bureau are here to stay – and worse thanoriginally imagined – have been the biggest contributing factors tothe more pessimistic outlook.”

Despite the growing pessimism among credit union executives –CEOs, COOs, CIOs, CFOs and compliance executives – 37% are stillvery or somewhat optimistic in their outlook for 2013, compared to43% in 2012. The remaining 38% expect the New Year to be the sameas the old year.

The survey report, however, doesn't address why nearly 40% ofexecutives hold an optimistic outlook for their credit unions.Nevertheless, executives have set their top five growth prioritiesto increase consumer loans, expand Internet/mobile banking, improvesales and marketing methods, grow mortgage loans or mortgageoriginations and increase member business loans.

The top five cost savings priorities among credit unionexecutives in 2013 are streamlining workflow, improving efficiencyratios, reducing reliance on paper, renegotiating vendor contractsand cutting back on branch-related expenses.

Within the financial and risk management realm, according to thesurvey, executives said their top five priorities are addressingregulatory compliance requirements, improving capital ratio,replacing NSF/OD income with other fee income sources, improvinginvestment management policies and processes and improving lendingpolicies and processes for better risk management.