WASHINGTON-CUNA has revised down the number of new members credit unions attracted during September and October as part of the Bank Transfer Day hoopla by about one-third, but it is still expecting sign-ups during November to be strong.
That revision, in turn, led to headlines that included "Credit Unions Eat Crow On Customer Numbers" and "Banks Revel in Credit Union Gaffe" as the banking industry jumped on the development.
CUNA originally stated that credit unions signed 650,000 new members leading up to Bank Transfer Day. But after rechecking data and comparing it with the latest monthly CU reports, the trade association now estimates that 441,000 new members enrolled. During September and October CUNA estimates that credit unions added 227,000 and 214,000 new members respectively. No figures have been released for November.
CUNA Chief Economist Bill Hampel said the difference likely resulted from CUs counting both new members and new checking accounts during the latest CUNA survey of credit unions. "And given there was some ambiguity in the way we asked the question, credit unions could have likely responded for both new checking accounts and new members," Hampel told Credit Union Journal.
Hampel pointed out that the downgraded growth number is roughly equal to 75% of total member growth in all of 2010. "That is still very healthy growth."
At the American Bankers Association, Senior Economist Keith Leggett told American Banker, "There is a saying that you are supposed to measure twice and cut once. They decided to cut without measuring."
Hampel noted that while the membership growth numbers prior to Bank Transfer Day are now lower by one-third, CUs actually picked up a lot of new business from those existing members who brought over their checking accounts.
A Happy 'Tail'
"A lot of the people who heard about Bank Transfer Day wanted to take action and it was easy for them to do so. They said, 'I belong to a credit union and I just have to move my checking account.' As opposed to others who had to find a credit union and were uncertain if they could join."
"I think there will be a tail to all this Bank Transfer Day activity. It may be wishful thinking, but the folks who are moving in response to bank pricing tend to be heavy debit card users, and a large percentage younger members," he continued. "I think they will see the credit union is friendly, has all the services banks do, and a large, free ATM network. They have a way of talking to their friends that is a little more efficient than some of us older folks. I think there will be a lot of interest in CUs through much of next year."
