Off-balance sheet services result in higher fee income at credit unions.

In the past decade, fee and other operating income have increased fairly steadily both as a percent of assets and as a percent of income, according to Callahan's First Look Data program.

 
 

In the past decade, fee and other operating income have increased fairly steadily both as a percent of assets and as a percent of income, according to Callahan's First Look Data program. The two categories of income were 0.6 percent of assets at the end of 1990. By the end of 2000, they had risen to 0.9 percent, and annualizing the First Quarter 2001 results shows that they may now have reached 1.0 percent of assets for the first time. The attached graph shows that during the decade fee and other operating income grew from six percent of gross income to 12 percent.

Our recent research here at Callahan's strongly implies that this change is not the result of increased charges to members for bouncing checks. Rather it is the result of the move to off-balance-sheet activities. Our recent research has found $800 to $900 million in first mortgages originated by credit unions that are then funded by a third party. These transactions generate fees for credit unions that are paid by the funding organization.

Callahan research has also documented $25.9 billion in assets-under-management by credit-union-owned investment services and there are billions of dollars in insurance products purchased by members through their credit union's CUSO or through another credit-union-controlled structure.

Learn more about First Look data
 

 

 

May 7, 2001


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