As loan growth declines in the majority of Arizona's financial co-ops, one little credit union is bucking the trend.
I’m finally taking a vacation. By the time you read this I’ll be basking in the sun in Phoenix. My little getaway, combined with last week's lending theme week, inspired me to check how Arizona’s credit unions are faring. And one smaller credit union stood out with its lending trends: U-Haul Federal Credit Union ($4.1M, Phoenix, AZ).
U-Haul FCU, with 2,987 members, is the 44th largest credit union by assets in Arizona, a state that had 50 credit unions in 2011. Statewide, the average loan growth was -13.8%, making it the worst performing state for loan growth in the past year, according to Callahan & Associates’ 2012 Credit Union Directory.
But unlike its larger counterparts, U-Haul FCU has snared a whopping 18.4% loan growth, to secure $2.6 million in total loans from Sept. 2010 to Sept. 2011, making it a standout loan growth leader in a state where only nine other credit unions reported improvements. According to Callahan's Peer-to-Peer data, U-Haul FCU continued to shore up loans in the third quarter, when it reported $2.8 million in loans, or 18.2% 12-month loan growth.
U-Haul FCU’s delinquency trends are also countering Arizona’s higher delinquency rates. The state’s credit unions averaged a 4.1% delinquency ratio, placing it 49th among states and the District of Columbia for delinquency with only Nevada and Montana performing more poorly. In contrast, U-Haul FCU reported a 1.20% delinquency ratio, which is better than the national average of 1.60%.
I see on U-Haul FCU’s website that one way the credit union is beefing up its loan portfolio is by heavily promoting a $500 Quick Cash loan as a way for members to manage unexpected expenses. In a region where people are taking out fewer loans, likely because they’re strained by the effects of the slumping local economy, the short-term unsecured loans are probably just what they need.