Callahan & Associates reported Wednesday that credit union net income margins fell in the first quarter as inflation, rising interest rates and diminished loan payoffs changed the dynamics of their operations.
First-quarter credit union net income was 0.86% of average assets, down from a peak of 1.04%% a year earlier and 0.91% in the fourth quarter.
In the Washington, D.C., based company's first-quarter Trendwatch webinar, Jay Johnson, chief collaboration officer, and Will Hunt, industry analyst, described major reversals that have occurred in the past year:
|- The growth rate for loans doubled, while the growth rate for savings was half the rate of a year ago.
- Loan originations for real estate were flat, while other loans rose 11%.
- Net interest margins, which had been falling in 2020, were unchanged from a year ago.
"We're starting 2022 very differently than we started 2021," Johnson said.
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