Asset Quality Reaches Pre-Recession Levels In Second Quarter 2015

Continuously improving asset quality indicates the stability and financial soundness in the credit union system and heralds another record-breaking quarter.
Janet Lee

The credit union industry’s loan portfolio expanded by 10.7% year-over-year, topping $755 billion as of June 30, 2015. And according to second quarter FirstLook data on 5,605 credit unions, these are quality loans.

The industry showed a significant improvement in asset quality in second quarter 2015. Credit unions reported lower delinquency and net charge-off ratios as of June 2015 compared to one year ago. According to data collected through Callahan’s FirstLook program, the industry’s delinquency ratio decreased 11 basis points to 0.74%. Among major loan categories, auto loans posted the lowest delinquency 0.54%. The overall net charge-off rate also declined two basis points to 0.47% with first mortgages posting the lowest ratio 0.07%.

DELINQUENCY AND NET CHARGE-OFF RATIOS
For 5,605 FirstLook Credit Unions | Data as of 06.30.15
Callahan & Associates | www.creditunions.com

asset_quality_ratios_for_2nd_article

Source: Peer-to-Peer Analytics by Callahan & Associates

Among all states, Colorado credit unions reported the lowest delinquency ratio 0.35% as of June 2015 while Delaware credit unions posted the greatest improvement in their delinquency ratio a 20-basis-point year-over-year decline. All but one state reported an annual decline in the delinquency ratio as of June 30, 2015.

TOP 10 STATES WITH THE GREATEST IMPROVEMENT IN DELINQUENCY RATIO
For 5,605 FirstLook Credit Unions | Data as of 06.30.15
Callahan & Associates | www.creditunions.com

Rank State Number of FirstsLook Credit Unions Available Delinquency Ratio as of June 2015 Delinquency Ratio as of June 2014 YOY Change in Delinquency Ratio
1 DE 20 1.27% 1.46% -0.20%
2 AK 12 1.04% 1.23% -0.18%
3 NC 73 1.37% 1.50% -0.13%
4 FL 142 0.99% 1.10% -0.11%
5 WI 143 0.82% 0.93% -0.11%
6 UT 64 0.69% 0.79% -0.11%
7 NY 328 1.10% 1.21% -0.10%
8 IA 96 0.72% 0.82% -0.10%
9 MI 254 0.77% 0.87% -0.10%
10 VA 133 0.67% 0.76% -0.10%

Source: Peer-to-Peer Analytics by Callahan & Associates

August 26, 2015

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