A 10-Year Look Back At Secondary Capital

Nine graphs show what impact secondary capital has had within the credit union industry during the past decade.


Interest in secondary capital is growing, and new strategies, larger loans, and NCUA decisions are changing the way credit unions deploy it.

Since the 1990s, the federal government has allowed low-income credit unions (LICUs) to accept non-member deposits and secondary capital, which gives credit unions a shot to their net worth and makes available new avenues to expand loan portfolios, assets, and services.

More than 40% of all credit unions held a low-income designation at midyear; however, only 70 reported using secondary capital. Even fewer institutions in credit union land have made secondary capital a foundational element in their mission to help members and stimulate the economies of the low-income communities in which they operate.

The following nine metrics draw from more than a decade of data from the 5300 Call Report as well as Callahan’s own Peer-to-Peer analysis tool. They highlight the impact secondary capital has on cooperatives and the members they serve.

The NCUA has pushed back against new ways to wield secondary capital, bringing to light a debate about the role of secondary capital in the credit union industry. Read more in “What Is The State Of Secondary Capital At U.S. Credit Unions?

The CEO of the Self-Help credit unions uses secondary capital to fight predatory lending and protect financially vulnerable consumers. Learn more in “How Martin Eakes Became The Most Hated Man In America (By Payday Lenders).”

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