State Farm FCU Is Among Top 10 Most Efficient $1 Billion Credit Unions

A distinct branching model contributes to lean operations at the $3.9 billion institution.

 
 

Efficiency ratios at America’s credit unions have improved since June 2014. The industrywide ratio, which measures how much money it takes credit unions collectively to earn $1 of revenue, has declined 64 basis points to 74.56%.

A lower efficiency ratio indicates a credit union is smartly using its assets and liabilities, and few credit unions are as efficient as State Farm Federal Credit Union ($3.9B, Bloomington, IL). The SEG-based credit union posted a second quarter efficiency ratio of 49.18%. That’s a 6.08% year-over-year improvement. 

EFFICIENCY RATIO
For all U.S. credit unions | Data as of 06.30.15
© Callahan & Associates | www.creditunions.com

Line_Graph_-_State_Farm_-_Efficiency_Ratio_Picture

Source: Peer-to-Peer Analytics by Callahan & Associates 

The credit union’s branching model is a major contributor to its efficient operations. Instead of relying on stand-alone branches, State Farm FCU establishes branches inside State Farm Insurance locations. This strategy has allowed the credit union to reduce many of the costs associated with opening and operating a branch. 

How Do You Compare?

Check out State Farm FCU’s Search & Analyze scorecard on CreditUnions.com; then build a peer group to compare your own performance.

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At midyear, State Farm FCU was among the most efficient credit unions in both asset-based and national peer groups. Compared to credit unions with $1 billion or more in assets, State Farm FCU ranked 9th out of 238. Out of the top 10 performing credit unions with $1 billion or more in assets, State Farm FCU showed the most improvement year-over-year followed by Self Reliance New York ($1.1B, New York, NY), which reduced its ratio by 3.01%. 

EFFIEICNCY RATIO LEADER TABLE
For credit unions $1B+ | Data as of 06.30.15
© Callahan & Associates | www.creditunions.com

State Name Efficiency Ratio
(before Provision for Loan Losses)
June 2015
Efficiency Ratio
(before Provision for Loan Losses)
June 2014
Year-Over-Year Change
AL APCO Employees 35.40% 36.40% 1.00%
NJ Merck Employees 39.25% 33.28% -5.97%
CA Star One 41.37% 41.30% -0.07%
NY SelfReliance New York 45.13% 48.14% 3.01%
NY Melrose 45.69% 47.37% 1.68%
CA F & A 47.49% 45.35% -2.14%
IA University Of Iowa Community 47.76% 48.07% 0.31%
GA Robins 49.10% 48.69% -0.41%
IL State Farm 49.18% 55.26% 6.08%
TX Navy Army Community 50.90% 48.34% -2.56%

Source: Peer-to-Peer Analytics by Callahan & Associates 

 
 

Aug. 25, 2015


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