U.S. credit unions reported their 18th consecutive quarter of loan growth, but profitability remain elusive during the third quarter, according to a report from SNL Financial.
The credit union industry recorded a 3.3% increase in aggregate total loans and leases from the sequential quarter, to just under $779 billion.
On a three-year basis, new-vehicle loans have soared 56.13% from 2012 to $97.6 billion during the third quarter, representing the fastest growth by loan type. Closed-end first liens for one- to four-family properties meanwhile grew by nearly $73 billion and represent the largest loan category at 41.1% of total loans.
While loan growth remained strong and net interest margin was up 5 basis points to 2.88% for U.S. credit unions, profitability measures worsened. Aggregate net income dropped to $2.28 billion for the third quarter from $2.42 billion in the linked quarter. Aggregate return on average assets fell 5 basis points quarter-to-quarter to 0.77%, and aggregate return on average assets plummeted 55 basis points during that same time span to 7.13%.
On a state level, New Jersey reported the lowest ROAA at 0.14%, with 32% of the states 183 credit unions going into the red. Vermont had the highest ROAA, as only four states recorded negative returns for the quarter.
