WASHINGTON – Lower yields on loan and investment portfolios, higher operating expenses and sluggish member growth all contributed to 2004's 0.92% return on assets, which is down from 1.01% in 2003 according to year-end analysis from Callahan & Associates. While ROA has been on a downward spiral for the past decade, the question becomes should CUs place stronger emphasis on this category as a benchmark? “There are differing opinions,” according to Callahan. “One school of thought – some might say the traditional one – has to do with the underlying credit union mission: serving the member.” Dissenters say in order to “remain viable financial service providers in a highly competitive environment, (there is a) need to invest in infrastructure and develop platforms,” Callahan reported. Reducing dividends paid to members, charging market rates on loans, and maintaining branch presence only in affluent areas should lead to higher net income for credit unions, in the process boosting ROA for the whole industry, Callahan said. “But most of us would see these actions as conflicting with the fundamental principles by which credit unions are governed,” Callahan offered. At the end of the day, determining the right level of ROA “is as much an art as a science.”