2025 was a whirlwind year, but from a balance sheet perspective, it could’ve been a whole lot worse.
That’s the consensus from a variety of credit union leaders who braved a year of economic anxiety and come out intact on the other side. The task ahead? Maintain that momentum as they head into another year of uncertainty.
“I feel like there’s more certainty this year compared to [at the end of 2024],” says Seth Rudd, chief financial officer at Leaders Credit Union ($1.3B, Jackson, TN). “Saying that, the way we approach every year, regardless of what’s going on, is we’re going to reach our goals. We take economic indicators into account, but for the most part we know what we need to accomplish next year.”
Lending Landscape
Leaders isn’t expecting any major balance sheet changes in the year ahead. Rudd says he believes it’s unlikely mortgage business will pick up significantly, but he expects another strong year. He also expects auto lending rates to remain steady. Although he bases his prognostication on rate forecasts for the Fed, local forecasting also plays a major role.
“We mostly pay attention to our local market and what we’re seeing,” he says. “We’re not seeing bankruptcies increase significantly. It’s in line with where we’ve been the past 12 to 24 months.”
Rudd says Leaders intends to stay “laser-focused” on its current product mix, blending 65% auto lending with 25% real estate and consumer lending rounding out the remainder.
“We’re committed to our model,” the CFO says. “We don’t expect a change.”
EFCU Financial ($1.2B, Baton Rouge, LA) is taking a similarly optimistic approach, understanding that it could need to pivot quickly if things go south.
“We’re positioned to handle any economic uncertainty within reason,” says Tom Kuslikis, president and CEO. “If there’s something catastrophic, we’d feel pain because of that. Now that we’re going into a declining rate environment, we’ll be keeping a close eye on our expenses and managing appropriately.”
More than 40% of EFCU’s loan portfolio is auto loans, which Kuslikis says still has room to reprice. Margins have increased a lot and financials are strong, and with a lower rate environment expected in 2026, it’s likely the credit union will begin to see some margin compression, he says.
If rates go down as expected, notes William Hunt, director of industry analytics at Callahan & Associates, it could spark mortgage activity as purchase activity picks up from consumers looking for cheaper housing options.
At Leaders, third quarter credit card growth stood at 11.49%, about half of where it was three years ago, and Rudd says delinquencies and charge-offs are picking up in lower credit tiers.
That’s in line with the K-shaped recovery many Americans have been feeling but also reflects a resilient consumer, Hunt says.
“People are still spending,” the Callahan analyst adds. “Unemployment hasn’t shot up as a whole, so most industries aren’t doing mass layoffs, even if there are some struggles. This is definitely generalized — there are pockets that are feeling that.”
Combining Forces
Ent Credit Union ($9.7B. Colorado Springs, CO) has purposefully controlled growth the past few years to stay under $10 billion in assets and avoid the additional costs and regulatory issues that come with crossing that threshold. Its merger with Wings Financial Credit Union ($9.4B, Apple Valley, MN) will send it well past that line.
“We’ve not been able to flex from a growth and balance sheet-management perspective,” says Dan Leclerc, chief financial officer at Ent. “We’re going to be in good shape with these two credit unions coming together.”
That “flex” includes a more strategic approach to deposit acquisition while getting more aggressive around loan origination. Ent has historically focused on mortgages and consumer lending, whereas Wings has excelled at commercial deals — a market that grew by more than 35% across the industry between the third quarters of 2024 and 2025, according to analysis from Callahan & Associates. That combination, Leclerc says, sets the stage for a big year.
His forecast for 2026 includes 5% deposit growth and 7% loan growth. The former will come from marketing deposits more aggressively and entering new markets in both Colorado and Minnesota.
“We’re opening six to eight new branches next year, front-loaded to the beginning of the year,” Leclerc says. “That always comes with promotional marketing, and we always get a bit of a [deposit] bump from new branches.”
Headcounts, Deposit Management, And More
Across the industry, delinquency rates have followed seasonal swings but are largely improved form one year ago. Leaders’ Rudd says he expects charge-offs to rise slightly in 2026 but doesn’t expect significant changes.
Conversely, EFCU anticipates setting aside less for credit losses in 2026, thanks in part to a well-insulated market that continues to produce strong job growth — Baton Rouge is home to a robust oil and natural gas sector.
Kuslikis adds that the need for investments — particularly those related to technology — isn’t going to slow down, but one area where the credit union has a bit more control is staffing. EFCU’s total headcount has gone up 37% in the past five years to more than 140 employees. The credit union has no plans to reduce that, but it is slowing the velocity at which it’s adding team members, which Kuslikis says will help with managing rising salary and benefits costs.
The CEO also expects the deposit mix at EFCU to shift further away from high-rate long-term CDs to lower non-maturity shares. That should help keep margins stable in an uncertain economy as the credit union works to manage expenses and cost of funds.
Post-merger, Ent plans to continue its strategy of being “in the ballpark” for CD rates, since that has proven to be a stable funding source, Leclerc says. Although money market accounts might not grow, Leclerc expects to see that funding stick around, in part because Ent largely hasn’t repriced those accounts. And there’s always the possibility there could be some attrition from money markets to CDs.
Flexibility Is Key
So did Americans dodge an economic bullet in 2025, or will the other shoe drop?
“I’d be lying if I said I knew the answer,” says Callahan’s Hunt. But he does concede that, for now, there are no alarm bells going off.
“The optimistic perspective is that the resiliency of the past year has put credit unions in a pretty strong position from a capital and earnings standpoint to give themselves a rainy day fund,” the analyst adds. “There’s some cushion there to help if things get worse or to invest in growth if things turn around. They have flexibility for whichever way it goes.”
Leaders’ Rudd offered a different mantra: “Have your plan, stick to your plan, and if the world changes significantly, change your plan.”
Take A Closer Look. Learn what performance trends are pushing the industry forward and see where credit unions stand heading into 2026. Check out Callahan & Associates’ Trendwatch webinar on-demand for insights and expert analysis. Watch today.