Credit unions with assets of less than $20 million are not riding the loan growth wave like their bigger counterparts.
According to CUNA Mutual Group's August Credit Union Trends Report, they reported loan growth of less than 2% in June, the latest month tracked.
Meanwhile, credit unions with more than $1 billion in assets reported loan growth in excess of 10%.
“The good news for 2014 is credit unions of all asset sizes are now reporting positive loan growth,” Steve Rick, CUNA Mutual chief economist said. “However, there remains a substantial differential between large and small credit union loan-growth rates.”
New auto loans continued to dominate with loan balances increasing 3.3%, versus a 1.5% increase reported in June 2013, according to the trends report.
Rick said credit unions are pricing their new and used auto loans aggressively, beating the average bank rate by 1.25 percentage points.
Credit union five-year new auto APRs averaged 2.59%, 125 basis points below the bank average. Longer-term loans are now increasing the affordability of new cars, he added.
Subprime auto loans accounted for 14.2% of credit union auto loan portfolios, the report showed, citing data from Experian.
Indeed, vehicle loans are leading the way across the industry with a 15.4% growth rate year-over-year, followed by member business loans at 12.8%, and first mortgage loans at 9.3%, the data showed.
Credit union loan balances rose a strong 1.4% in June, significantly better than the 0.9% pace reported in June 2013, Rick said.
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