NAFCU Finds Growing Optimism About Economy, Finds Little Usage of Excess Insurance

ARLINGTON, Va. — NAFCU's August Flash report found mounting optimism among members who participated in the association's monthly survey even as, unsurprisingly, it reported that NAFCU member credit unions dislike private share insurance.

NAFCU's survey reported that the outlook for near term loan demand was more optimistic than had been the case in the prior 12 months. Respondents reported being overall more optimistic about four major loan categories as well as more upbeat about share growth as well.

The four loan categories asked about were new vehicles, used vehicles, real estate, and unsecured loans.

The survey found in new and used vehicle lending that optimism was up over July's report in every region of the country but two. Only respondents from region two, which includes credit unions in Delaware, District of Columbia, Maryland, New Jersey, Pennsylvania, Virginia and West Virginia, reported expecting weaker demand for new vehicle loans over the next 12 months.

When it came to used vehicle loans, only credit unions in region one, which includes Connecticut, Maine, Massachusetts, Michigan, New Hampshire, New York, Rhode Island and Vermont expected weaker demand.

Regions three, four and five reported a positive outlook for both vehicle lending categories over the next 12 months.

Likewise, four of the five regions reported anticipating an increase in unsecured loan demand over the next 12 months relative to the prior 12-month performance, as were expectations for real estate lending.

NAFCU also surveyed its members about private share insurance and reported that only 16% of them provide excess share insurance over and above the amount provided by National Credit Union Share Insurance Fund. The members also reported that only 5% of their share dollars were covered by this insurance coming from only 1% of accounts.

None of the credit unions surveyed reported that they would choose private share insurance, even if they were allowed to do so. Furthermore, 83% of the members surveyed reported agreeing with a statement NAFCU attributed to former Federal Reserve Chairman Alan Greenspan that “that there is no private insurer substitute for deposit insurance from the government.”