Credit Unions Provide Nearly One-Third of Car Loans

Auto lending trends heading up.

Credit unions held record shares of the nation’s loans to consumers for credit cards and automobiles in June, the Fed reported Tuesday.The Fed’s G-19 Consumer Lending Report showed credit unions held 5.8% of the nation’s credit card debt in June, their highest share since the Fed began tracking the numbers in January 1984. It was essentially unchanged from 5.8% in May and up from 5.6% in June 2017.Credit unions’ share of non-revolving debt—which includes cars, recreational vehicles, boats, computers, appliances and student loans—was 13.4%, the highest since January 2007. It was up from a 13.2% share in May and 12.8% share in June 2017. Credit unions’ share of car loans was close to 32% in June.At credit unions, revolving debt from credit cards and non-revolving loan balances increased from May to June at higher rates than the one-month increases a year earlier.Credit unions held $58.6 billion in credit card debt on June 30, up 9.8% from a year earlier—and rising twice as fast as other lenders. Credit unions’ gain from May to June this year was 0.5%, up from a 0.4% gain a year earlier.All lenders held $2.9 trillion in non-revolving consumer loans in June, up 4.7% from a year earlier. This included $1.5 trillion in student loans, up 5.8% from a year earlier, and $1.1 trillion in car loans, up 3.6%.Credit unions held $383.3 billion in non-revolving consumer loans in June, up 9.2% from a year earlier. The increase from May to June this year was 1.9%, up from a 0.7% gain a year earlier.Total U.S. motor vehicle loans grew 1.6% from March to June, up from a 1.2% gain a year earlier and countering a trend of decelerating growth from the previous five quarters. However the March-to-June growth was still significantly slower than second quarter growth from 2012 to 2016 when it ranged from 2.4% to 2.9%.Car loans made up only 39% of non-revolving debt among all lenders in June, but it makes up about 94% of credit union non-revolving debt based on total vehicle loans reported by CUNa Mutual Group.That data places vehicle loans at credit unions at about $361 million as of June 30, or 31.9% of U.S. motor vehicle loans, up from 31.1% in March and 29.7% in June 2017.