If the latest data is any indication, members are still sticking with their credit unions when it comes to building their savings nest eggs.
Indeed, a combination of higher deposit yields and more members seeking financial safe havens has helped boost the savings at credit unions.
At $933 billion, savings were up 4.1% year to date and 6.0% since May 2012, according to CUNA Mutual Group's July "Credit Union Trends Report," which tracked data through May.
"Given the extremely low deposit yields, 6.0% annual growth is remarkable and reflects a combination of members seeking safe haven and possibly deposit yields higher than necessary," wrote Dave Colby, CUNA Mutual chief economist, in the report.
Regular shares yielding 0.26% were up 6.4% year over year and have accounted for 34% of annual savings growth, according to the data.
Share drafts with a 0.28% yield climbed 10.9% since May 2012 and accounted for 22% of annual growth while money market accounts with a 0.37% yield posted 5.1% annual growth and supplied 19% of savings growth.
Certificates of deposit fell in May but were up 6.9% year to date and $9.4 billion or 4.5% since the same period in 2012. At 0.88%, the national average one-year CD yield is down five basis points year over year.
Even around the world, credit unions are in the midst of a savings boost. According to the World Council of Credit Unions' "2012 Statistical Report," savings and share volume topped the $1.3 trillion mark based on information from 55,952 credit unions serving more than 200 million members in 101 countries.
In fact, the World Council said it has implemented credit union strengthening and savings mobilization programs in Bolivia, Ecuador, El Salvador, Guatemala, Honduras, Mexico, and Nicaragua.
"The liquidity from savings deposits supplies credit unions with the funds to meet local member credit demand and provides the institutions with a stable and long-term source of self-sustaining financing," according to "Striking the Balance in Microfinance: A Practical Guide to Mobilizing Savings," World Council publication. "In other words, the credit unions evolve into true financial intermediaries, raising savings deposits to fund their lending portfolios."
Earlier this month, rate tracking site GoBankingRates.com reported credit unions were edging out banks when it came to savings rates. Based on average rates from 5,000 community banks and credit unions, the site found that banks had a slightly lower annual percentage yield on their savings accounts of 0.18% compared to 0.20% at credit unions.
In its ranking of the top 10 credit unions with the highest rates, GoBankingRates.com found that all offered rates of 1.25% and higher while banks' rates ranged between 0.85% and 1.01%.
Meanwhile, looking at where members might see some economic optimism, Colby pointed to robust new light vehicle sales, a stronger housing recovery with sales and prices up and inventories down and improving job growth.
"These bright spots bode well for credit union industry lending and credit quality results going forward," Colby said.
Still, the economy still has a way to go, Colby added.
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