total investments & quarterly growth chart Source: Callahan & Associates

A third round of stimulus payments combined with the seasonal spike in share inflows translated to annual deposit growth of 22.7%. From year-end 2020, share balances rose 6.4%, compared to 4.3% quarterly growth a year ago. Given the scale and atypical growth drivers that transformed credit union balance sheets over the last 12 months, it is important to contextualize this growth and recognize how different segments of the balance sheet are changing in relation to one another given the base effect and the impact of COVID-19 a year ago.

Following the dramatic gains in the deposit portfolio, investment balances rose accordingly. On a quarterly basis, total investments surged 16.4% from December to March (up by $98.9 billion), totaling $700.8 billion at quarter-end. Continuing recent trends, the combination of a limited supply of short-term bonds, modest yields and a persistent uncertainty about deposit retention assumptions translated to quarterly cash balance growth of 23.4% from December, and 81.9% year-over-year. Investments in securities and certificates expanded at a slower, yet historically strong linked quarter pace of 11.7% as investment officers worked double-time to put money to work.

Complete your profile to continue reading and get FREE access to CUTimes.com, part of your ALM digital membership.

Your access to unlimited CUTimes.com content isn’t changing.
Once you are an ALM digital member, you’ll receive:

  • Critical CUTimes.com information including comprehensive product and service provider listings via the Marketplace Directory, CU Careers, resources from industry leaders, webcasts, and breaking news, analysis and more with our informative Newsletters.
  • Exclusive discounts on ALM and CU Times events.
  • Access to other award-winning ALM websites including Law.com and GlobeSt.com.

Already have an account?


NOT FOR REPRINT

© 2023 ALM Global, LLC, All Rights Reserved. Request academic re-use from www.copyright.com. All other uses, submit a request to [email protected]. For more information visit Asset & Logo Licensing.

 

Credit Union Times

Join Credit Union Times

Don’t miss crucial strategic and tactical information necessary to run your institution and better serve your members. Join Credit Union Times now!

  • Free unlimited access to Credit Union Times' trusted and independent team of experts for extensive industry news, conference coverage, people features, statistical analysis, and regulation and technology updates.
  • Exclusive discounts on ALM and Credit Union Times events.
  • Access to other award-winning ALM websites including TreasuryandRisk.com and Law.com.

Already have an account? Sign In Now
Join Credit Union Times

Copyright © 2023 ALM Global, LLC. All Rights Reserved.