Nevada was the only state that did not experience asset growth over the 12 months ending March 31, the NCUA stated. The economic situation remains difficult there, but there are some good credit unions, like One Nevada FCU, that are working to make a difference in the economically depressed state. Keep doing good work to help dig out.

ROA dipped a bit to 83 basis points from 85 bps year-over-year, according to the NCUA. Utah experienced the highest ROA of 155 bps, which is not surprising with credit unions like Mountain America CU, American First CU and myriad others. Unfortunately, tiny Delaware was home to the credit unions with the lowest ROA at 26 bps. Still, by CUNA's data, credit unions' ROA has been steadily climbing out of despair since 2009. Stay the course!

The federal agency pointed out that 71% of credit unions boasted positive ROA in the first quarter, but that means 29% experienced negative ROA. A business, even a not-for-profit one, cannot sustain that. Regulatory and financial uncertainty have kept credit unions from merging at a faster pace, some out of necessity and some as strategy, but that will soon change as the economy continues to stabilize and regulatory changes become deeply engrained in credit unions' operations. Larger credit union combinations, such as the merger between First Community FCU and E&A CU in Michigan, are bound to become more common as credit unions search for scale to compete, comply and carry on.

We'll see more failures of smaller credit unions and less-than-voluntary mergers, despite valiant efforts by the NCUA, the National Federation of Community Development Credit Unions and others. Tom Glatt Jr., of Glatt Consulting issued a report showing that his firm's HealthScore found that credit unions in aggregate aren't as healthy as they were a year ago. The decline was driven by smaller credit unions. Overall, his firm's HealthScore ranked credit unions at 2.446, but those credit unions with less than $2 million in assets average 1.722, and those from $2 million to $10 million scored 2.095. NCUA Director of the Office of Small Credit Union Initiatives Bill Myers got laughs for his story about when he was greeted by a manager, who ran the credit union out of his home, in slippers. It's a funny anecdote until you think about it. He added that 30 credit unions were still not on computers. The cost to examine these credit unions, the hours, and lack of security, among other things, just doesn't make sense.

In addition to loan growth finally picking up, credit unions are experiencing tremendous membership growth. NCUA's data showed membership expanding 2.3% nationally among federally insured credit unions, which is even higher than the 2.0% growth experienced the year before. At the same time, share growth is trickling downward, setting credit unions up for increased loan-to-share ratios and income, even as delinquencies continue to decline.

Credit unions are coming out the other side now, so upward and onward in the fight to educate members while saving them money, making their lives richer.

Sarah Snell Cooke
Publisher/Editor in Chief
[email protected]