Despite an industry average loan-to-share ratio that has exceeded 80%, a new survey from CUNA has found that many credit union CEOs said boosting consumer loan volume is the single-most-critical operational challenge facing credit unions.
Improving loan volume, however, may prove to be an even greater challenge in 2006 as both CUNA and NAFCU are projecting loan growth will slow (see related story page 8). CUNA's 2005-2006 Consumer Lending Survey, for instance, is projecting loan growth to slow to around 8% in 2006 due to high oil prices, rising interest rates, high levels of consumer debt and low pent-up demand for autos and home purchases.
"Furthermore, nearly half of the survey's respondents express having difficulties acquiring new consumer loans," CUNA said. "When coupled with increased competition from both traditional and non-traditional lenders, credit unions face a challenging operating environment."
The Consumer Lending study examines economic conditions that have an effect on consumer lending, including indirect auto lending; risk-based lending practices; marketing budgets and their allocation, subprime lending, and approval channels. The survey's cost is $195. For info: www.cuna.coop.
