Silver State Schools Credit Union's 2Q earnings flat from a year earlier

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Las Vegas-based Silver State Schools Credit Union said its second-quarter results showed “sustained growth and progress in lending, deposits and profitability.”

In the second quarter, the $790 million-asset institution said on Monday that it had earned roughly $2.6 million, which was flat from a year earlier. For the first half of 2019 Silver State Schools earned about $4.3 million, down almost 10% from the same period a year earlier. The credit union noted it has placed $1 million in its provision for loan losses in the first six months of 2019, compared to $703,000 in the first half of 2018.

Excluding the charges to the provision for loan losses, Silver State Schools said its core earnings for the first six months of 2019 were $5.3 million, compared to $5.4 million for the first half of last year.

According to a statement released Monday, “steadily improving net interest margin, consumer loan growth and overall asset quality” all contributed to the credit union’s results. SSSCU said its net interest margin ratio increased from 3.33% as of June 30, 2018, to 3.57% a year later. Officials said this was due to an increase in consumer loan portfolio balances and a higher-yielding loan portfolio.

The credit union’s loan-to-share ratio increased from 79.19% in the first quarter of 2018, to 86.63% for the same period a year later, which it attributed to “increasingly strong” loan demand. Despite the overall dollar amount placed in its allowance for loan losses increasing, SSSCU said the allowance percentage decreased to 0.44% of total loans, down from 0.50% of a year earlier. It said this was due to “favorable credit and economic conditions.”

“We are consistently improving our financial strength, as evidenced by our increasing regulatory capital ratio and overall financial and asset quality performance,” Scott Arkills, Silver State Schools CU’s president and CEO, said in a statement.

“The credit union has benefitted from improved consumer confidence, low unemployment trends and continues to improve substantially each quarter, with positive earnings for the past seven years,” Arkills added.

The CU was battered during the great recession and endured the painfully slow recovery in southern Nevada. Silver State Schools had $1 billion in assets prior to the financial crisis, but that plummeted to $622 million at the end of 2012. In 2009, Silver State Schools lost $50.8 million, followed by a loss of $21.4 million in 2010 and $8.4 million in 2011.

The credit union is privately insured by American Share Insurance.

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Earnings Revenue and expenses Loan-loss provisions Lending Nevada