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Credit unions are continuing to build on a record of successfully serving members while expanding the movement's footprint across the country.

One way we can see that? First mortgage market share has reached another new record high: 8.6% in the first quarter of 2017. That's $30.9 billion spread across 2,849 of the nation's 5,859 credit unions on record in the Callahan & Associates Peer-to-Peer database as of March 31.

The industry also just posted its 11th consecutive quarter of double-digit loan growth and the highest first-quarter share growth since March 2003.

Credit union market share for first mortgage originations has also recovered from a recent low of 5.9% in Q1 2013, steadily rising to a new high of 8.6% at the end of the first quarter of this year.

That's 160,410 individual first mortgages made in the first three months of 2017, each one a story behind the numbers. We can't tell all those, but we can extrapolate from the numbers that the credit union industry as a whole seems to be lending more responsibly than the competition.

First mortgage delinquency at credit unions has dropped steadily from a high of 2.29% in December 2010, to 0.44% in Q1 2017. Compare that to the 5,856 U.S. banks in our database, which as a whole posted first mortgage delinquency of 2.93% as of the first quarter.

Net charge-offs are also showing a similar decline, as are home equity loans, reflected as "Other RE" in the accompanying charts.

Underlying both the growth of the portfolio as well as the improvement in asset quality is a shift in the makeup of the portfolio. Fixed-rate products still account for two-thirds of all first mortgage originations, down from a relatively recent high of 83.2% in March 2013. The composition of the portfolio has varied since the recession due to changes in interest rates, homeowner demand and consumers' risk appetite for mortgages.

Using the market rate, as reported by Freddie Mac, for 30-year fixed rate mortgages as a proxy, coupled with the percentage of first mortgage refinancings from the Mortgage Bankers Association, we're able to better understand how the composition of the origination portfolio has changed over time. As noted in the accompanying graphs, you can see that interest rates began falling in 2011.

Accordingly, refinancings notably account for a larger percentage of first mortgage originations as homeowners capitalize on falling rates. Many of these refinancings are in the form of fixed-rate mortgages, likely happening as homeowners move out of riskier, interest rate-sensitive adjustable rate products.

Striking a Balance

In 2013, as interest rates started to rise, there was a corresponding shift in the balance between purchases and refinances, leading to a decline in the latter. Additionally, as purchase mortgages increased relative to refinancings, the share of fixed-rate products fell as homeowners locked in lower rates, and payments, via adjustable rate and balloon mortgages. That may reflect many factors, including homeowners thinking they'll stay put for several years instead of 30 and/or simply finding ARMs and balloon notes much more affordable. Home values and homeowner job security and salaries also play a role in this shift.

Whatever the reason for each of those individual decisions to finance a home, there are a lot of people doing it. First mortgage originations were up 15.9% year-over-year in the first quarter after rising only about 2% from Q1 2015 to Q1 2016. And that's while the whole U.S. mortgage industry saw only a 3% rise from early 2016 to early 2017.

There's also the liquidity perspective. Credit unions, of course, can manage liquidity in many ways, some of the most common include selling mortgage originations and selling participations. Selling first mortgages to the secondary market has traditionally been the channel of choice for credit unions looking to free up liquidity and manage interest rate risk.

Year-to-date, first mortgage originations sold to the secondary market increased 10.2% to $10.8 billion, however, as a percentage of total first mortgage originations, this metric fell 1.8 percentage points from the first quarter of 2016. Sales as a percentage of first mortgage originations peaked in March 2013 at 58.1% and has gradually declined through the first quarter of 2017.

As credit unions' origination portfolios shift to more adjustable rate products, combined with rising interest rates (albeit gradual), managers are increasingly choosing to portfolio more loans due to the friendlier interest rate risk characteristics of adjustable and balloon mortgage products.

In the larger picture, this overall loan growth is happening while member growth has been accelerating to 109.4 million, growing 4.2% in 12 months ending Q1 2017.

Again, credit unions appear to be continuing to take advantage of the momentum in the market and increasing their share. We discuss all this and more in our latest Trendwatch webinar. Check it out at CreditUnions.com.

All in all? It's a good time to be a credit union. And a credit union member.