Credit unions regained some lost ground from the fourth quarter to the first quarter in auto financing, but lost market share from last year's first quarter, according to Experian.
Experian's State of the Automotive Finance Market report for the first quarter showed credit unions' share of total new and used loans was 22.7% in the first quarter, down from 23.8% a year earlier and up slightly from 22.24% in the fourth quarter.
Banks' share of total loans was 30.7% in the first quarter, up from 28.6% a year earlier and down from 31.79% in the previous quarter.
The share held by captives fell slightly over 12 months and the quarter, while the share held by finance companies and others rose over both periods as the number of subprime loans increased slightly.
The 1.1-point drop in share by credit unions from last year's first quarter, and the 2.1-point gain by banks, was mirrored in loan balance changes. NCUA data pulled from Callahan's Peer Suite showed credit unions held $483.2 billion in auto loans March 31, down 0.3% from a year earlier, while FDIC data released May 27 shows banks held $541.7 billion in car loans March 31, up 4.9%.
Banks' auto loan portfolios were shrinking from June 30, 2023 through March 31, 2025, but have since been rising at faster rates each quarter. The gain of 4.9% through March 31 was the best 12-month gain for banks since June 2022 and the March 2026 balance was the biggest in three years.
Credit union auto loans have also been shrinking for the past few years. While the size the 12-month drops has diminished, the balances are still falling.
The bulk of the decline has come from new car loans, but used car lending has also shown weakness.
Credit unions' share of new auto loans was 15.3% in the first quarter, down slightly from 15.5% a year earlier and up from a low of 14.2% in the previous quarter.
Banks' share of new auto loans was 31.9% in the first quarter, up from 30.4% a year earlier and down from 33.7% in the previous quarter.
Captives continued to lead in new car lending, but their share fell, while the share held by finance companies and others rose.
Captives' share of new auto loans was 43.4% in the first quarter, down from 47% a year earlier and 43.8% in the previous quarter. Finance companies and others held 9.4% on new car loans in the first quarter, up from 7.1% a year earlier and 8.3% in the previous quarter.
Credit unions' share of used auto loans was 26.5% in the first quarter, compared with 28.1% a year earlier and 26.6% in the previous quarter.
Banks' share of used auto loans was 30.1% in the first quarter, up from 27.7% a year earlier and down from 30.7% in the previous quarter.
Experian found 60-day-plus delinquencies rose from 0.83% in March 2025 to 0.86% in March 2026.
NCUA data showed credit union delinquencies were lower and stable: 0.79% for both periods.
Experian's report also showed 111,000 borrowers refinanced $3.4 billion in loans during the first quarter, matching the amount a year earlier, but down from $4.2 billion in the fourth quarter. Borrowers refinancing in the first quarter at a credit union shaved an average of $101 from their monthly payment, compared with $60 for those refinancing at banks.
Contact Jim DuPlessis at Jim.DuPlessis@arc-network.com.
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