Credit unions grow assets, but delinquencies – especially credit cards – also mounting; ROAA, net income trend down

Total assets in credit unions reached $2.26 trillion at year-end 2023, their federal regulator reported Tuesday, which represented a 4.1% increase over the previous year’s growth.

However, according to the National Credit Union Administration (NCUA), financial performance decreased in the last year, particularly on late loan payments, especially credit cards.

Overall, delinquencies at credit unions were 83 bp, up 21 bp from the previous year, NCUA said. Credit card delinquencies were up a whopping 211 basis points (bp) from 148 bp one year earlier, according to NCUA. The agency noted that delinquencies on non-commercial real estate loans were 56 bp in the fourth quarter of 2023, which the agency said was 13 bp higher than in the fourth quarter of 2022.

The auto loan delinquency rate increased 23 bp over the year to 90 bp in the fourth quarter of 2023, according to the NCUA report.

In other areas of financial performance, NCUA said return on average assets was down 19 bp to 69 bp. At the same time, net income for credit unions was down 18.8% ($3.5 billion) from the previous year-end, totaling $15.2 billion. Nevertheless, net worth among credit unions increased by $8.7 billion (3.8%) to $24.5 billion.

Total loans outstanding increased $96.2 billion, or 6.4%, NCUA said, to $1.60 trillion. Total shares and deposits rose by $31.2 billion, or 1.7%, to $1.88 trillion, according to the agency.

Credit Union Assets and Delinquencies Grow in the Fourth Quarter