RANCHO CUCAMONGA, Calif. - The California and Nevada CU Leagues recently released the 2008 WestScan economic activity report for credit unions in the two states. WestScan is an annual financial report–with quarterly updates–that examines economic, financial, demographic, and other trends affecting CUs in the Golden and Silver States.
Among the economic trends projected to affect credit unions:
* CU loan growth showed impressive resiliency as the category was up 6.54% in 2007, slightly off 2006’s 7.83%. Despite the lagging real estate market, first mortgage loans grew $5.3 billion in the fourth quarter, ending 2007 up more than $20 billion, a 15.21% jump.
* Return on average assets (ROA) was down 0.18 percentage points to 0.65% at year-end 2007 from 2006’s 0.83%. CUs nationwide also watched their net interest margin slip, but only slightly, to 3.12% in 2007 from 3.17% in 2006.
* The modest 1.67 percentage point increase over 2006’s 84.03% indicates that while loan dollars continue to grow, CUs currently should have sufficient deposit dollars to meet liquidity needs, the league said.
California’s Statistics
One “very positive” indicator in the Golden State: gross income to average assets grew in 2007 to 6.98%, from 6.49% in 2006.
The report shows assets for California credit unions grew by 3.93% in 2007, down only 0.57 percentage points from the previous year, which was 4.50%. Membership growth had its highest increase since 2004, accelerating to 1.64% in 2007 from 1.04% in 2006.
Mortgage lending is reportedly alive and well at credit unions as first mortgage lending grew at 13.03% and other real estate lending at 8.87%.
Nevada’s Statistics
Despite an ever-growing housing slump and economic pressures felt in the Silver State’s marketplace, Nevada credit unions still realized positive gains in 2007.
First mortgage lending grew at 13.34%, credit cards grew at 27.39%, and unsecured lending grew at 24.32%.
Membership growth accelerated to 0.30% in 2007 from 0.14% in 2006.
Although down 3.55 percentage points from 2006’s 4.14% gain, assets still grew 0.59%. (c) 2008 The Credit Union Journal and SourceMedia, Inc. All Rights Reserved.http://www.cujournal.com http://www.sourcemedia.com
