Little Negative Post-Hurricane Effect Foreseen
Though the nation's economy likely will take a hit in the form of higher energy costs resulting from Hurricane Katrina, there could also be a long-term benefit to the economy resulting from the recovery period following the storm, according to CUNA Mutual Group.
The firm's most recent Credit Union Trends Report suggests better times ahead based on a variety of economic data, including unemployment rate, consumer confidence and other leading indicators, but CMG was careful to point out that these data releases were based on pre-Katrina information.
So, despite the most recent economic data indicating overall improvement in the economy, CUNA Mutual is predicting that economic growth will slow in the near term. But as recovery and rebuilding efforts get underway in the storm-battered Gulf Coast, that spending should provide a boost late in the fourth quarter and into 2006, the firm predicted.
Other Data Highlights
Among the highlights gleaned from the pre-Katrina data:
* Through the end of July there were 9,149 credit unions. This reflects a net decline of 353 credit unions over the past year and 197 year-to-date.
* Savings and asset growth slowed again in July with annual savings growth at 2.4% and asset growth at 3.6%. Total assets equal %688.5 billion.
* New vehicle loans increased a healthy 3% in July and supplied more than 37% of the month-only change in loans.
* Membership stood at 87.4 million at the end of July, up 1.6 million over the past year.
* At 77.4%, the loan-to-share ratio is now 5.2 percentage points above the July 2004 level.
* The capital-to-asset ratio climbed to 11.1%, up from 10.56% at this time last year.
* The loan delinquency rate remained below .60%.
* Year to date, total loans are up 6%, with 35% of the gain coming from first mrtgages, 27% from "other" real estate loans and 23% from new vehicle loans.
CUNA Mutual Group is predicting loan growth slowing to 7.6% by year-end based on declining new vehicle gains and continued sales of first mortgages.
CUNA Mutual Group said it anticipates the CUNA Economics and Statistics group, whose data CMG used in putting together its report, will release semi-annual data revisions with next month's data, and at that time CMG will highlight any significant deviations from current trends.
For more information on the data, visit CUNA Mutual online at www.cunamutual.com.