September Events Impact Third Quarter Trends

The traditional seasonal patterns of very low savings growth and strong loan growth in the third quarter were completely reversed in 2001. While we now know that the economy has officially been in a recession since March, the primary event affecting this quarter was the September 11th terrorist attack and the subsequent pause of most consumer spending, borrowing and investing activity.

 
 

The traditional seasonal patterns of very low savings growth and strong loan growth in the third quarter were completely reversed in 2001. The three-month increase in savings for the 1,587 credit unions over $50 million in assets was 3.6%, or almost twice the rate in the same period in 2000. Likewise, the three-month loan increase of only 3.1% was half the 6.5% rate in the 2000 third quarter.

While we now know that the economy has officially been in a recession since March, the primary event affecting this quarter was the September 11th terrorist attack and the subsequent pause of most consumer spending, borrowing and investing activity.

Top 25 Credit Unons (greater than $50 Million) Ranked by Share Growth
For Period Ended September 30, 2001
Rank
ST
Name of Credit Union
Share Growth
Total Shares

Ave. Share
Balance

Cost of
Funds

Return on
Ave. Asset
Loans/Shares
1
CA
Financial 21 Community
54.17%
$121,839,129
$8,822
3.82%
0.38%
63.89%
2
FL
Sarasota Coastal
49.83%
$156,100,340
$6,079
3.52%
0.40%
68.59%
3
NJ
Tri-Co
41.78%
$76,802,781
$5,592
2.65%
0.87%
54.78%
4
AZ
Salt River Project
41.46%
$194,294,677
$5,988
4.16%
0.49%
84.00%
5
OH
Atomic Employees
40.51%
$84,821,128
$4,135
3.18%
0.58%
96.32%
6
CT
Mutual Security
39.79%
$118,507,625
$4,953
3.29%
0.68%
71.13%
7
FL
Bell Tel
37.75%
$223,654,862
$4,431
2.94%
0.67%
78.09%
8
AZ
Arizona State Savings & Credit
36.97%
$674,203,068
$6,057
3.87%
0.94%
58.53%
9
AZ
Tucson
36.35%
$146,658,173
$8,170
4.53%
-1.19%
91.19%
10
ID
Idaho Central
35.64%
$191,246,315
$5,074
2.90%
1.29%
80.77%
11
CA
Norton Community
34.72%
$162,496,270
$9,498
3.57%
0.17%
71.11%
12
FL
Health Service
34.31%
$58,471,483
$5,022
3.69%
1.01%
53.00%
13
ND
Capital
33.88%
$101,788,069
$5,558
3.39%
0.90%
76.14%
14
CA
USC
33.59%
$114,070,400
$3,411
3.60%
1.66%
96.15%
15
MN
General Mills
33.45%
$87,580,310
$7,196
3.44%
1.39%
84.47%
16
IL
Chicago Patrolmens
33.43%
$112,211,329
$6,740
3.96%
0.81%
72.14%
17
WI
Fort Community
33.34%
$75,475,100
$5,556
3.32%
1.22%
76.56%
18
FL
Pinellas County Teachers
32.51%
$305,560,037
$6,094
3.31%
1.10%
68.06%
19
FL
Sunshine State
32.30%
$103,470,001
$6,389
3.49%
0.22%
85.31%
20
UT
Family First
31.81%
$73,955,825
$4,274
3.66%
1.16%
101.42%
21
CA
Toyota
31.10%
$100,046,474
$7.393
3.34%
1.13%
83.07%
22
MI
Community Choice
30.94%
$130,008,153
$3,556
2.69%
0.77%
73.86%
23
IL
Abbott Laboratory Employees
30.83%
$195,148,403
$7,244
3.28%
1.39%
73.31%
24
CA
Kern Schools
30.66%
$807,530,870
$6,878
4.05%
0.76%
84.99%
25
WA
Qualstar
30.44%
$188,277,390
$3,396
4.15%
0.57%
69.76%

Savings growth for the 12 months ending Sept. 30th, 2001 for the largest credit unions increased by 16.5%, the highest growth recorded since 1986. (See above table for top 25 credit unions in rate of share growth for the last year)

Even more remarkable, more than three quarters of this growth came from existing members. The average share balance for all members in credit unions greater than $50 million was $6,102, which is a 12% increase over the same average one year earlier. Approximately 4.4% of the increase was from new members.

Moreover, many credit unions had not lowered their pricing as of the end of the quarter at the same pace that market rates had declined. The average cost of funds for the first nine months of 2001 was 4.0%, exactly the same as in 2000. However the Federal Reserve lowered short-term interest rates seven times in 2001 to a rate of only 2.5% at the end of the third quarter. Much of the savings increase came in money market accounts (up 31.7% for one year) and share certificates, which grew 21.1%.

Next week CreditUnions.com & Callahan & Associates will analyze the slowing loan growth and the earnings outcomes for the first nine months of 2002.

Top 10 Credit Unons Ranked by Increase of $ Share Growth
For 12 Month Ended September 30, 2001
Rank
Name of Credit Union
Increase $
Share Growth
Total Shares
Share
Growth

Cost of Funds

Return on
Ave. Asset
1
Navy
$2,050,065,067
$11,949,531,267
20.71%
3.79%
1.31%
2
S+tate Employees
$1,263,335,596
$7,144,745,276
21.48%
4.30%
0.92%
3
The Golden 1
$694,170,883
$3,277,294,333
26.87%
4.25%
1.40%
4
American Airlines
$663,514,026
$2,953,665,364
28.97%
4.24%
1.23%
5
Boeing Employees
$599,860,474
$3,332,361,814
21.95%
3.74%
0.44%
6
Pentagon
$547,893,771
$3,660,690,431
17.60%
4.41%
1.54%
7
Orange County Teachers
$539,899,155
$2,842,265,835
23.45%
3.99%
1.56%
8
Suncoast Schools
$472,071,826
$2,563,179,506
22.58%
4.51%
1.09%
9
United Airlines Employees
$445,278,662
$3,046,329,032
17.12%
4.70%
1.45%
10
Patelco
$374,289,661
$2,079,977,843
21.94%
4.07%
1.52%


 

 

 

Dec. 3, 2001


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