MADISON, Wis.—The rise in credit union lending maintained its pace in June, with auto loans continuing to drive advances, according to CUNA’s monthly credit union estimates.
New auto loans saw a 2% increase during the month, with fixed-rate first mortgages next (1.7% increase) and used auto third (1.6% advance). Overall loans outstanding increased by 1.4%, CUNA reported.
Unsecured personal loans increased by 1.1%, adjustable-rate mortgages by 0.8%, credit card loans by 0.4%, and home equity loans by 0.2%.
“Sound economic fundamentals and competitive rates explain the continued expansion of credit union lending activities in June,” Perc Pineda, CUNA senior economist, told CUNA’s News Now.
The improvement in the economy, with GDP rising 2.3% in the second quarter, may have helped fuel the loan growth, said Pineda, who added that loan growth increased 16.8% on an annualized basis in June.
The 60-day delinquency rate at credit unions nationwide dropped to 0.65% for the month, down from 0.83% on a year-over-year basis, and the lowest number since February 2006.
“The unemployment rate continues to fall and household balance sheets are more stable in recent months,” Pineda said. “This translates to more, and confident, borrowers in the market.”
Other highlights:
- The loan-to-savings ratio increased to 74.6% in June from 75.5% in May.
- The movement’s overall capital-to-asset ratio came in at 10.8%.
- Credit union savings balances rose to 0.1%, after a 0.6% increase in May.
- Memberships rose by 0.4% in June, totaling 103.4 million members nationwide.