CU Loan Balances Continue to Grow at Fast Pace

Credit union loan balances rose from June to July at rates far above normal, but at a slower pace than the records set in the previous two months.

CUNA’s Monthly Credit Union Estimates showed credit unions held $1.45 trillion in total loans on July 31, up 17.3% from a year earlier and up 1.9% from the previous month. The average June-to-July increase from 2016 to 2020 was 0.8%.

The gain from May to June was 2.5%, which CUNA said was a record for any set of months since it began collecting monthly data in 1993.

July followed a Lake Wobegon growth pattern, where all major loan types were above average, at least from the previous month.

First mortgage balances were the only category with a drop from July 2021, and first mortgages are also the most commonly sold category. They fell 1.6% to $540.8 billion from a year earlier and rose 1.9% from the previous month. That compares with a June-to-July average of 0.5%.

From a year earlier, fixed-rate first mortgages rose 6.1% to $462.8 billion, while adjustable-rate first mortgages fell 31.1% to $78.1 billion.

Second-lien mortgages grew 12.2% to $94 billion from a year earlier and rose 5.1% from the previous month. That compares with a June-to-July average of 1.4%. Second mortgages rose 7.1% to $30.4 billion, and home equity lines of credit rose 14.7% to $63.6 billion.

New car loans grew 17.3% to $167.7 billion from a year earlier and rose 1.9% from the previous month. That compares with a June-to-July average of 0.7%.

Used car loans grew 18.5% to $300.8 billion from a year earlier and rose 1.4% from the previous month. That compares with a June-to-July average of 0.9%.

Unsecured consumer term loans (excluding credit cards) grew 22.5% to $62.8 billion from a year earlier and rose 4.4% from the previous month. That compares with a June-to-July average of 0.9%.

The Fed’s G-19 Consumer Credit report released Thursday showed credit cards grew 13% to $68.8 billion from a year earlier and rose 1.8% from the previous month. That compares with a June-to-July average of 0.9%. Credit unions’ share of credit card debt was 6.3% in July, compared with 6.2% in June and 6.4% in July 2021.

Banks held $997.8 billion in credit card debt on July 31, up 15.9% from a year earlier and up 0.9% from June. Banks’ share of credit card debt was 90. 9% in July, unchanged from June and up from 90.1% in July 2021.

CUNA’s report showed the nation’s 5,036 credit unions had 134.9 million members in July, up 3.7% from a year earlier and up 0.3% from June. The report also showed:

• Loans per member were $10,720, up 13.2% from a year earlier and up 1.6% from June.
• Savings per member were $13,981, up 3.1% from a year earlier and down 0.2% from June.
• Savings were $1.89 billion, up 6.9% from a year earlier and up 0.1% from June.
• Assets were $2.17 trillion, up 6.3% from a year earlier and up 1.4% from June.
• The 60-day-plus delinquency rate was 0.45% as of July 31, compared with 0.46% a year earlier and 0.42% a month earlier.