Over 50% of non-interest income is directly related to the core share draft account, according to a recent Callahan & Associates survey. Credit unions are deriving a sizeable portion of their non-interest income from non-sufficient funds (NSF) and courtesy pay as well as from debit card interchange income. ATM charges and check sales make up the other components of this total.
With the net interest margin dropping to 2.98% as of the first quarter for credit unions reporting to the First Look program, the search for new avenues of fee income is gaining momentum. Credit unions are required to report two line items on their 5300 Call Report: fee income and other operating income. These two broad designations do little to identify their constituent parts, so Callahan & Associates conducts a semi-annual survey to identify specific sources of non-interest income.
Year-end 2004 Results
Non-interest income totaled $7.3 billion for the credit union industry in 2004. According to our latest survey, share draft accounts and credit card fees account for two-thirds of the income.