Credit Unions Capture 9% Of U.S. Deposits

Credit unions add a record amount of shares and pick up market share.

 
 

As of June 2009, credit unions deposit market share reached 8.98%, up six basis points from the same point in 2008. Over the past year, turmoil in the stock market and across the financial services industry helped credit unions add a record amount of shares and pick up additional market share.

Recently released FDIC deposit data shows that credit unions and banks both benefited from market instability as consumers moved to the safety of insured savings. The slight increase in credit union market share is also a sign of more deposits moving to "local" institutions.

Below is the table of the five states in which credit unions grew their market share by the largest percentage. Market share growth in these states has been driven both by the success of credit unions as well as by bank troubles. For example, the collapse of Washington Mutual in September of 2008, which previously held $188.3 billion in deposits nationally, had a significant impact on Washington credit unions' increased market share in the state.

Credit Union Market Share
Data as of June 30, 2009
  June 2008
Market Share
June 2009
Market Share
Change (% pts)

Rhode Island

9.7%

11.0%

1.3%

Texas

9.1%

10.2%

1.2%

Washington

17.4%

18.5%

1.1%

Vermont

15.2%

16.2%

1.0%

Missouri

6.6%

7.3%

0.8%

Source: Callahan & Associates' Branch Analyzer

It is also encouraging to see that in some states, where they have a smaller market share, credit unions are making steps towards expanding their reach. For example, New Jersey credit unions held 3.7% of the market as of June ‘08 but have now expanded their share of the states' deposits to 4.1%, an 11.3% improvement over the past year.

Credit Union Market Share
Data as of June 30, 2009
  June 2008
Market Share
June 2009
Market Share
Change
(% of Mkt Share)

Texas

9.1%

10.2%

13.1%

Rhode Island

9.7%

11.0%

12.9%

Mississippi

6.1%

6.8%

12.0%

Missouri

6.6 %

7.3%

11.7%

New Jersey

3.7%

4.1%

11.3%

Source: Callahan & Associates' Branch Analyzer

These states provide examples of the gains that credit unions can make from continuing to deliver value to members. While some credit unions have tried to slow deposit growth in order to maintain capital ratios, the data shows that opportunities remain.

With bank failures continuing to make news, opportunities will continue into 2010. According to research conducted by Callahan & Associates, branches that are taken over by new financial institutions typically lose at least 15-20% of their deposits, which means that each of these bank closures provides opportunities for credit unions to attract new members and new relationship in the effected communities.

Callahan & Associates can help you identify and quantify the opportunities resulting from these closures with our analytical tool, Branch Analyzer.

 

 

 

Nov. 2, 2009


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