Q3 Data Will Be Neither Sky High Nor Rock Bottom

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ONTARIO, Calif.-While cautioning that he had not yet had the opportunity to review all third quarter Call Report data in detail, the California and Nevada's Daniel Penrod said the likelihood is Q3 numbers for credit unions in the two states will be "muted."

"We are not expecting big highs or big lows. Deposits will continue to grow."

Penrod spotted a possible reason for optimism in the fact retailers are expanding temporary hiring for the holiday shopping season. He said there was a "bump" in back-to-school shopping this year, "so there is a hope this can continue to build into the fourth quarter."

"If we do get that, it will go a long way toward telling us the consumer is starting to make a comeback," he said. "Consumers will not open their spending unless they start to feel more comfortable."

According to Penrod, CUs in the two states should be cautiously optimistic looking at the fourth quarter. Overall trends in the market will not translate to all credit unions because of the ties to their fields of membership and geography, he warned, they will go as their membership goes.

Individual consumers, even with unemployment where it is, are getting a boost from low interest rates and manufacturer incentives which Penrod said give people an opportunity to look at their situation and take control. For those who have loans with even moderate rates, he noted, such as a mortgage higher than 5%, they could change by a half-point or even a point."

They should take the opportunity to refinance and get themselves on strong footing now so when the economy improves they can take advantage of it. This is an opportunity for credit unions, because many banks have closed off their lending or made it almost impossible to qualify for loans. Credit unions can shine through that darkness and be what we've said all along-be a member, not just a customer."

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