DALLAS-CEOs have not felt so glum about their credit unions' finances and the economy, according to results of Southwest Corporate Federal Credit Union's fourth quarter 2009 CU CEO Confidence Survey, which sunk to a new low.
CEOs gave their current credit unions' condition a mark of 17.84, the lowest in the survey's six-year history. The metric had been trending upward the previous two quarters before plunging 17 points in the most recent survey. CEOs' assessment of their financial condition six months from now also fell by 14 points.
"Many CEOs continue to be shell-shocked from 2009 events, such as a 35% rise in loan delinquency, modest 1.6% loan growth, diluted capital formation and net incomes that neared industry lows," said Brian Turner, Southwest Corporate's Director of Advisory Services. "Most will continue to face these challenges through the first half of 2010, as cash tills overflow from rising shares the first quarter, and loan demand remains weak until the summer."
The overall confidence index for this survey slid from 29.01 at the end of the third quarter to 20.23 this quarter. In addition, credit unions' view of their members' financial condition, at the present and in six months, took a marginal downturn. And finally, expectation for loan demand dropped almost 11 points, and expectation for share deposit growth decreased by seven points from third quarter 2009.
CEOs in the Midwest had the highest average confidence level of the six regions measured, 41.07, followed by CEOs in the Southeast, with 33.00. CEOs in New England had the lowest confidence level, just 16.67.
CEOs in the West had a confidence level of 29.17; in the Southeast 33.00 and in the Northwest 31.25.
CEOs in the second smallest asset category, $2 million to $10 million, had the highest confidence level, 35.19. Credit unions in the largest asset category, over $500 million, had the lowest confidence level, 25.86.
The quarterly survey measures credit union CEOs' feelings in six categories. In addition to the two already mentioned, the survey gauges perspective on: members' current financial condition; members' financial condition six months from now; credit union loan demand in six months; and credit union share deposit growth in six months. For the fourth quarter, numbers decreased in all six categories.
The survey was sent to 1,324 credit union CEOs, and 332 responded for a response rate of 25.08%.
