ARLINGTON, Va. — Credit union membership growth slowed in May while lending continued to strengthen, according to NAFCU's July Economic & CU Monitor.
The survey of NAFCU members also revealed that a number of CUs made good on their threat to exit the remittance market due to new CFPB rules, which are increasing the costs of money transfers as well as the compliance burden.
In May, credit union member growth, which had been increasing or holding steady this year, fell to 2.7% from 2.8% in April. The aggregate net worth ratio, as well, dipped to 10.67%, a decline of four basis points from April.
Net interest margins increased by four basis points in May and respondents generally expect them to decline over the next year.
Loan growth increased to 9.1%, two BPs above April. And while respondents see that number continuing to move up this year, they also expect first mortgage loan growth to be nearly flat over the next 12 months.
The CFPB's rule on remittance transfers went into effect in October 2013, raising the disclosure requirements for institutions that process more than 100 remittances per year.
Reviewing the impact of the rule, more than one-third (35.3%) of respondents have ceased or limited their remittance services since the rule went into effect. Nearly as many (31.3%) have been forced to pass on increasing costs of providing remittance services to members.
In November, credit unions indicated that they expected the cost of international wire transfers would rise. With that increase, and the cost and burden of increased compliance with the new rule,
