Mid-Year Earnings Affect Planning

Net interest margin continues to cover the daily cost of doing business while provisions for loan losses decline again.


Financial data from credit unions in the second quarter offers several key trends that may help credit unions better plan their next financial moves. Total revenue, which was up $165 million, in credit union land has been positive for each of the past six years with net interest income, fee income and other operating income all up compared to the same quarter in 2010, says Callahan & Associates’ analyst Lydia Cole.

“This is something we can attribute to the credit union model – even though asset growth has slowed, the total revenue continues to rise,” says Chip Filson, president of Callahan & Associates.

This multimedia video, part of Callahan & Associates’ TrendWatch presentation on early second quarter data, also details how non-interest income, as a percentage of income, has remained fairly unchanged compared to the past several years. Our analysts explain how the margin between the net interest margin and the operating expense ratio has narrowed over the past year, but operating expenses have been flat.

“The margin is covering operating expenses,” Filson says. “It’s been that way for almost a year. There was a time when we thought it will never reverse and we need to charge more fees and more non-interest income.”





Sept. 5, 2011


  • Economies are in dire strtais, but I can count on this!