utah and national cu economic update 2014 ulcu annual meeting and convention march 14 th , 2014 •...
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Utah and National CU Economic Update 2014 ULCU Annual Meeting and Convention March 14 th , 2014 • Salt Lake City, Utah Mike Schenk Vice President, Economics & Statistics Credit Union National Association Telephone: 608-231-4228 Facsimile: 608-231-4924 E-Mail: [email protected]. - PowerPoint PPT PresentationTRANSCRIPT
Utah and National CU Economic Update2014 ULCU Annual Meeting and ConventionMarch 14th, 2014 • Salt Lake City, Utah
Mike SchenkVice President, Economics & Statistics
Credit Union National AssociationTelephone: 608-231-4228 Facsimile: 608-231-4924
E-Mail: [email protected]
U.S. EconomyGetting Better? Or Worse?
Economic Overview
• Inching toward key goals
• Persistent & maddening weakness
• But some good signs
• With key implications for credit unions
Chained $2009, % Change Q/Q at SAAR. Source: BEA.
2007 2008 2009 2010 2011 2012 2013
1.8
-0.3
-2.8
2.5
1.8
2.8
1.9
3.25
Annual GrowthLong-Run Average Growth
Subpar Growth: U.S. Real GDP
Chained $2009, % Change Q/Q at SAAR. Source: BEA.
'08 '08 '08 '08 '09 '09 '09 '09 '10 '10 '10 '10 '11 '11 '11 '11 '12 '12 '12 '12 '13 '13 '13 '13
-2.7
2.0
-2.0
-8.3
-5.4
-0.4
1.3
3.9
1.6
3.9
2.8 2.8
-1.3
3.2
1.4
4.9
3.7
1.2
2.8
0.1
1.1
2.5
4.1
2.4
Economy Gaining Steam? U.S. Real GDP
5.0
7.8
10.09.8
9.18.3
7.96.6
2.8
8.4
4.94.0
Dec
-07
Jun-
08
Dec
-08
Jun-
09
Dec
-09
Jun-
10
Dec
-10
Jun-
11
Dec
-11
Jun-
12
Dec
-12
Jun-
13
Dec
-13
U.S. Unemployment RateSource: BLS.
"Headline" Fed Policy Threshold (6.5%) Utah
Declining Jobless Rate
Utah Unemployment Rate(By County. Source: BLS. December 2013.)
• Statewide = 4.0% (Dec.)• Fourth-lowest rate in US• Year-ago = 4.9%• 22 of 29 Counties below 5%• High: 8.4% (Dec ‘09/Jan ‘10)
Lowest:Cache 2.8%Duchesne 2.8%Summit 2.9%Uintah 2.9%
Highest:Grand 10.6%Garfield 14.1%Wayne 15.8%
Unemployment Rate TrendsSource: BLS. Not Seasonally Adjusted.
Dec. 2012 (%)
Dec. 2013 (%)
One-Year Change (%)
U.S. 7.8 6.7 -1.1Utah 4.9 4.0 -0.9
Logan, UT-ID 3.9 2.8 -1.1Ogden-Clearfield, UT 5.4 3.8 -1.6Provo-Orem, UT 4.9 3.5 -1.4Salt Lake City, UT 4.9 3.5 -1.4St. George, UT 6.6 4.3 -2.3
113200
Dec-
07
Apr-
08
Aug-
08
Dec-
08
Apr-
09
Aug-
09
Dec-
09
Apr-
10
Aug-
10
Dec-
10
Apr-
11
Aug-
11
Dec-
11
Apr-
12
Aug-
12
Dec-
12
Apr-
13
Aug-
13
Dec-
13
Changes in U.S. Nonfarm EmploymentSource: BLS
Change Assumed Fed Target…
Improving Jobs Picture
State Employment TrendsSource: BLS. Not Seasonally Adjusted.
MSA
Dec. 2012 (000)
Dec. 2013 (000)
One-Year Change (000)
Utah 1,279 1301.6 22.5
Logan, UT-ID 55.7 55.6 -0.1Ogden-Clearfield, UT 202.3 206.2 3.9Provo-Orem, UT 198.7 207.3 8.6Salt Lake City, UT 49.5 51.3 1.8St. George, UT 664.3 674.2 9.9
Broad-Based Improvement• YOY unemployment rate decreases in 39
states
• YOY unemployment rate decreases in ~80% of the nation’s 372 MSAs
• Nearly all key business sectors showing employment gains
Broad-Based Employment GainsSource: BLS. In thousands. % of Total
EmploymentJan. ’14 Change
YOY Change
Mining & logging 1% 7 36Construction 4% 48 179Manufacturing 9% 21 93Retail & wholesale trade 15% 1 412Transportation & utilities 4% 10 49Information 2% 0 6Financial activities 6% -2 65Professional & business svs. 14% 36 656Education & health services 15% -6 306Leisure, hospitality & other svs. 14% 28 459Government 16% -29 -53Total 100% 114 2,208
138.4
129.7
137.5
Dec
-07
Apr-0
8
Aug-
08
Dec
-08
Apr-0
9
Aug-
09
Dec
-09
Apr-1
0
Aug-
10
Dec
-10
Apr-1
1
Aug-
11
Dec
-11
Apr-1
2
Aug-
12
Dec
-12
Apr-1
3
Aug-
13
Dec
-13
U.S. EmploymentSource: BLS. (Data in Millions)
• Average monthly increase over past six months = 178,000.
• Back to pre- recession levels by June 2014?
Now Down 850,000 Jobs
4.1 4.
34.
14.
03.
9 4.1
4.9
5.5
5.3
5.0
3.7
1.1
0.0
-0.1
0.0
-0.4
-0.6
-1.0
-1.2
-2.0 -1
.5 -1.4
-0.2
1.9
2.8
2.6
2.1 2.3
2.2
2.0
1.2 1.
41.
21.
1 1.2
1.1 1.
4 1.7 2.
1 2.6 3.
1 3.5 3.5 3.6 3.7 3.8
3.5
3.5
3.0
3.0
2.9
2.6
2.3
1.8
1.7
1.4 1.
7 1.9 2.
21.
81.
81.
6 2.0
1.5
1.1 1.
4 1.8 2.
01.
51.
10.
9 1.2 1.
5 1.6
Dec-
07
Apr-
08
Aug-
08
Dec-
08
Apr-
09
Aug-
09
Dec-
09
Apr-
10
Aug-
10
Dec-
10
Apr-
11
Aug-
11
Dec-
11
Apr-
12
Aug-
12
Dec-
12
Apr-
13
Aug-
13
Dec-
13
U.S. Inflation Rate (%)Source: BLS.
CPI-Headline
CPI-Core
Fed Policy Trigger
Tame Inflation
9.2
12.7
5.0
6.6
Dec
-07
Jun-
08
Dec
-08
Jun-
09
Dec
-09
Jun-
10
Dec
-10
Jun-
11
Dec
-11
Jun-
12
Dec
-12
Jun-
13
Dec
-13
U.S. “U-6” Unemployment Rate (%)Source: BLS
2011 2012 2013 2014 2015
-0.9% -1.0%
-1.5%
-0.8%
-0.3%
Austerity’s Drag on Growth
< 30% 30-60% 60-90% 90%+
4.1
2.8 2.8
-0.1
4.2
3.1 3.2
2.2
Real GDP Growth Rates by Debt/GDP Ratio(Source: Herndon/Ash/Pollin. UMass Amerst Work-
ing Paper 322)Reinhart/Rogoff Herndon
High Debt Loads and Growth
82.178.1
0
10
20
30
40
50
60
70
80
90
100
08 09 10 11 12 13 14
Consumer ConfidenceSource: Conference Board
Aug. '11:Debt Ceiling
Dec. '12:Fiscal Cliff
Mar. '13:Sequester
Lehman/AIG
Equity markets bottom out
Recovery Act
Debt Limit & Confidence
No Inflation in Sight
3 4 5 6 7 8 9 10 11 12 13-2
-1
0
1
2
3
4
5
6
Inflation Expectations: 2003-2012(Source: Federal Reserve)
Inflation Expectations TIPS (10-Yr) 10-yr Treas
Obvious Pent-up Demand• The average age of consumer durable goods -- long-lasting items such
as furniture, appliances and computers -- is at a 49-year high according to data from the Bureau of Economic Analysis dating to 1925.
• Among things Americans are keeping for the longest time: furniture and furnishings (including clocks, lamps, and floor/window coverings) and home and garden tools like lawnmowers and snow-blowers.
• Cars and luggage were the only two of 17 categories the BEA tracks that saw a decrease in average age in 2012 – though age of cars remains near all-time high.
Replacement Cycle Boom Should Boost Economic Growth!
Strong Car Sales(Cars + Light Trucks. Source: BEA)
1990 1991 1992 1993 1994 1995 1996 1997 1998 1999 2000 2001 2002 2003 2004 2005 2006 2007 2008 2009 2010 2011 2012 2013
13.9
12.312.9
13.9
15.0 14.7 15.1 15.115.5
16.917.3 17.1 16.8 16.6 16.9 16.9
16.516.1
13.2
10.4
11.6
12.7
14.4
15.5
2007
20
08 20
08 20
08 20
08 20
09 20
09 20
09 20
09 20
10 20
10 20
10 20
10 20
11 20
11 20
11 20
11 20
12 20
12 20
12 20
12 20
13 20
13 20
13
0.0%
-0.7%
-3.1%
-6.0%
-6.8%
-6.1%
-8.6%
-11.0%
-11.6%
-12.7%
-13.4%
-12.6%
-13.2% -15.6%
-17.0%
-16.3%
-15.9%
-16.7%
-17.0%
-15.9%
-15.2%
-14.8%
-13.4%
-12.0%
-11.2%
Home Prices vs. December 2007(Source: FHFA All Transactions Index)
~2/3 ownership
Every $ gain = $0.08 increase in spending over following two years
Housing’s Obvious Rebound
YOY = +4.8%4th Qtr. = +0.9%
State Home Price TrendsSource: FHFA. All Transactions Index.
2013 4th Quarter Change
Full Year 2013
ChangeChange vs.
12/07Utah 1.0% 8.1% -11.0%
Logan, UT-ID -1.8% 0.6% -4.8%Ogden-Clearfield, UT 1.0% 5.9% -8.9%Provo-Orem, UT 1.5% 10.0% -13.7%Salt Lake City, UT 1.2% 9.4% -9.5%St. George, UT 2.0% 9.5% -26.3%
Strong Housing Metrics• Relatively strong sales:
• New Sales = 429,830 (strongest since 2008). Full-year 2013 sales = 16% increase over 2012.• Existing sales = 5.1 million (strongest since 2006). Full-year 2013 sales = 9% increase over 2012.
• Lowish supplies (January 4.7 months supply vs. LR avg of 6.0) -> higher prices/more building
• Solid price gains - consistent increases almost everywhere you look
• Housing starts (Census) = 2013 total=931,000 – strongest year since 2007.
• Builders Confidence (NAHB) = 47 in January ~ 50 for past nine months (and near 8-year high)
• Foreclosure filings (RealtyTrac) = -18% YOY January (40 consecutive months of YOY declines)
80 81 82 83 84 85 86 87 88 89 90 91 92 93 94 95 96 97 98 99 00 01 02 03 04 05 06 07 08 09 10 11 12 130
200
400
600
800
1000
1200
1400
1600
1800
2000S&P 500 Monthly Average
(Source: S&P)
~55% ownership
Every $ gain = $0.03 in-crease in spending over following two years
Big Equity Market Gains
79Q1 82Q1 85Q1 88Q1 91Q1 94Q1 97Q1 00Q1 03Q1 06Q1 09Q1 012Q10.00
0.20
0.40
0.60
0.80
1.00
1.20
Debt as a Percentage of Disposable HH Income(Source: Federal Reserve)
Dramatic Decline in Debt
Record HH Net WorthSource: Federal Reserve and BLS.
2001
Q1
2001
Q3
2002
Q1
2002
Q3
2003
Q1
2003
Q3
2004
Q1
2004
Q3
2005
Q1
2005
Q3
2006
Q1
2006
Q3
2007
Q1
2007
Q3
2008
Q1
2008
Q3
2009
Q1
2009
Q3
2010
Q1
2010
Q3
2011
Q1
2011
Q3
2012
Q1
2012
Q3
2013
Q1
2013
Q30
10
20
30
40
50
60
70
80
90
Nominal Inflation-Adjusted
Slow & Unsteady Recovery
Economic ForecastJanuary, 2014
5Yr Avg 2012 2013:1 2013:2 2013:3 2013:4 2013 2014
Growth rates:*Economic Growth (% chg GDP) 0.80% 2.80% 1.10% 2.50% 4.10% 2.50% 2.55% 3.25%Inflation (% chg CPI) 1.80% 1.70% 1.50% 1.75%Core Inflation (ex. food & energy) 1.75% 2.20% 1.70% 1.75%Unemployment Rate 8.30% 8.10% 7.70% 7.60% 7.30% 7.00% 7.40% 6.50%Fed Funds Rate 0.50% 0.14% 0.10% 0.10% 0.10% 0.10% 0.10% 0.10%10-Year Treasury Rate 2.95% 1.81% 1.95% 2.00% 2.71% 2.75% 2.35% 3.25%* Percent change, annual rate .
All other numbers are averages for the period
Actual Results Quarterly Results/Forecasts Annual Forecasts
Taxation Threat Is Real• Comprehensive Tax Reform Efforts Underway
– Congress starting with a “clean slate”– Public strongly supports deficit reduction efforts– Many CU members unaware of tax status– An example…Family_Pays_More.wav
• The more CU members know, the stronger their resistance to taxation. Winning message points:– Member-owned, member-directed– Locally controlled– Benefits returned to members
• Lower fees/cheaper loans/higher savings yields/easier to get loans• Nationally $5.8 billion in 2012 - $120 per credit union household• Measure and tell the world about the financial and nonfinancial benefits you deliver
• Need grassroots support– Engage your members – taxation is a tax on members – benefits at risk – Tell Congress: Don’t Tax My Credit Union!– www.donttaxmycreditunion.org/
Recent CU Results
• Fast membership growth
• Slow but increasing loan growth
• Vastly improved asset quality
• High earnings despite low interest margins
• Tremendous variation
Fast Membership Growth(Source: NCUA and CUNA)
2007 2008 2009 2010 2011 2012 2013
1.31.6 1.4
0.7
1.52.1
2.5
5.6
-3.5
3.9
12-month Growth
U.S. Utah
20-Yr. Avg. ~ 2.1%Net Great Recession ~ 2.2%
< $5 Mil. $5 to $20 Mil. $20 to $100 Mil. $100 Mil+
-2.3
-1.4
-0.1
4.2
2.6
0.8
-0.9
6.5
Full Year 2013By Size
U.S Utah
Faster Loan Growth(Source: NCUA and CUNA)
2007 2008 2009 2010 2011 2012 2013
6.5 6.7
1.2
-1.2
1.2
4.8
7.3
14.8
-10.3
7.9
12-month Growth
U.S. Utah
20-Yr. Avg. ~ 7.75%Net Great Recession ~ 9.25%
< $5 Mil. $5 to $20 Mil. $20 to $100 Mil. $100 Mil+
0.1
1.4
3.5
8.5
-2.9
3.22.8
10.2
Full Year 2013By Size
U.S Utah
Broad-Based Loan Increases
(Source: NCUA and CUNA)
Credit Cards Other Unsecured New Auto Used Auto 1st Mtg. HEL/2nd Mtg. MBLs
5.74.8
8.67.9
5.9
-8.1
6.57.7
9.1
12.7
10.5
8.7
-4.0
10.0
12-month Growth
2012 2013
Asset Quality: Delinquency
(Percent of Total Loans. Source: NCUA and CUNA)
2007 2008 2009 2010 2011 2012 2013
0.93
1.37
1.82 1.751.60
1.15 1.01
0.77
3.92
1.23
Period-End
U.S. Utah
20-Yr. Avg. ~ 1.00%Net Great Recession ~ 0.80%
< $5 Mil. $5 to $20 Mil. $20 to $100 Mil. $100 Mil+
2.60
1.64
1.29
0.97
2.33
1.14
0.83
1.25
Year-End 2013By Size
U.S Utah
Asset Quality: Net Chargeoffs
(Percent of Average Loans. Source: NCUA and CUNA)
2007 2008 2009 2010 2011 2012 2013
0.51
0.84
1.211.14
0.91
0.730.57
0.40
2.22
0.56
Total During Period
U.S. Utah
20-Yr. Avg. ~ 0.60%Net Great Recession ~ 0.50%
< $5 Mil. $5 to $20 Mil. $20 to $100 Mil. $100 Mil+
0.75
0.55 0.530.57
0.33
0.51
0.37
0.57
Full Year 2013By Size
U.S Utah
Interest Rate Risk(Net Long Term Assets as a % of Total Assets. Source: NCUA and CUNA)
2007 2008 2009 2010 2011 2012 2013
26.3
32.0 31.633.1 32.5 33.0
36.0
17.9
29.2
Period-End
U.S. Utah
< $5 Mil. $5 to $20 Mil. $20 to $100 Mil. $100 Mil+
6.8
17.1
28.9
37.2
5.3
16.8
27.4
29.6
Year-End 2013By Size
U.S Utah
Liquidity Risk(Total Loans/Total Savings. Source: NCUA and CUNA)
2007 2008 2009 2010 2011 2012 2013
83.4 83.2
76.372.2
69.4 68.6 71.0
94.8
77.4
Period-End
U.S. Utah
< $5 Mil. $5 to $20 Mil. $20 to $100 Mil. $100 Mil+
57.1 54.959.4
72.670.773.2 71.2
77.8
Year-End 2013By Size
U.S Utah
High Earnings(Percent of Average Assets. Source: NCUA and CUNA)
2007 2008 2009 2010 2011 2012 2013
0.64
0.31
0.15
0.50
0.68 0.84 0.77
-0.37
1.45Total During Period
U.S. Utah
20-Yr. Avg. ~ 0.90%Net Great Recession ~ 1.00%
< $5 Mil. $5 to $20 Mil. $20 to $100 Mil. $100 Mil+
-0.240.09
0.35
0.840.21
0.41
0.81
1.51
Full Year 2013By Size
U.S Utah
Surprises in the Details!Credit Unions Exceeding National NormsSource: NCUA and CUNA.
Category Totals
Total Memberships Growth > 2.1%
Total Loan Portfolio Growth >5.5%
ROA > 0.84%
Asset Category
Number of
CUs
% of All US CUs
Number of CUs
% of CUs in Asset Group
Number of CUs
% of CUs in Asset Group
Number of CUs
% of CUs in Asset Group
<$5 Mil. 1,456 21% 276 19% 407 28% 250 17%
$5 to $20 1,799 26% 326 18% 457 25% 261 15%
$20 to $100 2,067 30% 503 24% 634 31% 309 15%
$100 Mil. + 1,495 22% 711 48% 672 45% 464 31%
What’s Driving CU Earnings?
2011 2012 Change 2013 ChangeAsset yield 405 362 -43 336 -26
- Int. cost of assets 92 72 -20 59 -13
= Net interest margin 313 290 -23 278 -12
+ Non-interest income 131 145 +14 140 -5
- Operating expenses 326 316 -10 314 -2
- L&L loss provisions 50 35 -15 26 -9
= Net Income 68 84 +16 77 -7
Light Vehicle Sales(Cars + Light Trucks. Source: BEA)
1990 1991 1992 1993 1994 1995 1996 1997 1998 1999 2000 2001 2002 2003 2004 2005 2006 2007 2008 2009 2010 2011 2012 20130
2,000
4,000
6,000
8,000
10,000
12,000
14,000
16,000
18,000
2,80
5
5,59
9
4,44
5
3,26
6
1,56
0
492
2007 = 16.1 million2008 = 13.2 million2009 = 10.4 million2010 = 11.6 million2011 = 12.7 million2012 = 14.4 million2013 = 15.5 million
18.3 Million
Auto Sales Back• Average age (Polk) = record 11.4 years in 2013• New outlook (Edmunds):
– 16.4 million units in ‘14– Up from 15.5 million actual in 2013– Highest total since 2006– But # and % gains smallest since 2009– Big technology gains spurring interest
• Used outlook (CNW Mkt. Res./RVI Grp.):– Supply beginning to increase late in ’13 – Downward pressure on prices– Buyers market– Sales above 41 million units annually peaking at 43.5 in ’16– Private party sales climbing – hitting 31% in 2020
“Toy” Sales Firming• US motorcycle sales up (non-scooter sales up 3% in 2013 according to
Motorcycle Industry Council). Harley worldwide sales up 5.7% 4Q ‘13 & 4.4% full-year.
• RV shipments finished 2013 at a four-year high of 321,127 -- 12.4% ahead of 2012 levels. Motorhome shipments rose 36% to 38,322 units. Airstream sales +59% in 2013. RVIA expects a 6.1% increase in sales this year (which would mark the fifth consecutive annual gain).
• Off-roaders (ATV-type vehicles) continue to show accelerating growth, with annual sales up 13% in 2013 to about 250,000 units.
• Recreational boating industry continues post-recession gains, projecting a 5% to 7% increase in new powerboat sales for 2014, on top of a 5% increase last year. Leading the industry's growth are small fiberglass and aluminum outboard boats 26 feet or less in size.
Housing Outlook(Mortgage Bankers Association)
• Housing starts +13% in ‘14 and +10% in ‘15• Strong sales
– Existing homes: +4% in ’14/+4% in ‘15– New homes +9% in ’14/+4% in ’15
• Prices: +4.4% in ’14/+3.5% in ’15• Overall 1-4 Family Originations:
– -36% in ’14/+10% in ‘15– Refinance share: 63% in ‘13/39% in ’14/35% in ‘15
Net Interest Margin(Source: NCUA and CUNA)
1991 1992 1993 1994 1995 1996 1997 1998 1999 2000 2001 2002 2003 2004 2005 2006 2007 2008 2009 2010 2011 2012 2013
366
387 384377
388 387393
384 381
394
365
341
327 329 332 333 330
316
297
312305
290
278
Non-Interest Income Issues• Decline in refinancing activity• Overdraft protection
– CFPB report issued mid-June• Overdraft & NSF accounted for 61% of consumer deposit account charges in 2011• Overdraft median fee = $34 at large; $30 at small • Amount of annual fees fir accounts with at least one fee was $225• Growth of average monthly payments per household from 2000 – 2011 was 53%
– Inadequacies in disclosures– Egregious practices that maximize fees– Fees imposed prior to offering solutions– Proposal out later this year or early next year (no plan to regulate fees)
• Interchange litigation– Merchant/plaintiff sued to invalidate the Feds interchange rules– Fed filed appeal in August - status quo for now
• Stay & current rules in place until decision Fed recently filed briefing • Oral arguments – Fed ignored Congressional intent: “..none of us is buying that….”• Decision May?• If upheld in entirety – new rule in 4th quarter• If only partially upheld – early 2015
Credit Union Credit Quality Trends
(As a % of Loans. Source: NCUA and CUNA)
0.00%
0.25%
0.50%
0.75%
1.00%
1.25%
1.50%
1.75%
2.00%
0.00%
0.25%
0.50%
0.75%
1.00%
1.25%
1.50%
1.75%
2.00%
Net Charge-offsAllowance for Loan LossesLoan Loss Provisions
Corporate Stabilization Assessments
(Basis Points of Insured Shares. Source: NCUA and CUNA)
2009 2010 2011 2012 2013 2014 2015 2106
4.0
13.4
25.1
9.58.0
0.0 0.0 0.0
2013 = 8bp insured shares ($700 billion)Enough!Assessments + depleted capital exceed actual losses by $4 bilEstimated unrealized losses = $4 bilLiquidity concerns are key; recent recoveries have been large
CU Capital(Source: NCUA and CUNA)
2007 2008 2009 2010 2011 2012 2013
11.410.8
9.8 10.0 10.2 10.410.8
10.5
8.1
10.3
Period-End
U.S. Utah
< $5 Mil. $5 to $20 Mil. $20 to $100 Mil. $100 Mil+
15.813.4
11.5 10.6
16.7
12.8 12.9
10.1
Year-End 2013By Size
U.S Utah
Capital Reform• Our view
– Highest/most restrictive rules – CUs need more flexibility to serve members– Congress should modify the definition of credit union net worth to include
supplemental forms of capital & give NCUA more flexibility.• NCUA
– Bank vs. CU capital trends– Basel III changes– Sr. staff/Matz rumblings
• CUs with assets over $50 million subject to “improved” risk-based requirements• Result will be higher capital levels for credit unions with high concentrations of risky assets
• Comments: May 28th, 2014 (CUNA/NAFCU seeking extension)• CUNA evaluations
– PCA (7% “leverage” and generally nonbinding risk components)– Basel III (5% leverage ratio and more strict risk components)– Mix (Basel leverage & PCA risk weights/PCA leverage & Basel risk weights)
Closer to “Normal”Credit Union ForecastJanuary, 2014
5Yr Avg 2012 2013:1 2013:2 2013:3 2013:4 2013 2014
Growth rates:Savings growth 6.6% 6.1% 3.6% 0.0% -0.4% 0.5% 3.7% 4.0%Loan growth 2.5% 4.8% 0.2% 2.3% 2.7% 1.5% 6.7% 7.0%Asset growth 6.1% 6.2% 3.3% 0.1% 0.1% 0.8% 4.3% 4.3%Membership growth 1.5% 2.1% 0.7% 1.0% 0.4% 0.2% 2.3% 2.3%
Liquidity:Loan-to-share ratio** 73.9% 68.6% 66.3% 67.9% 70.0% 70.7% 70.7% 72.7%
Asset quality:Delinquency rate 1.47% 1.27% 1.06% 1.01% 1.01% 1.00% 1.02% 0.90%Net chargeoff rate* 1.00% 0.73% 0.61% 0.55% 0.54% 0.55% 0.56% 0.55%
EarningsReturn on average assets (ROA)* 0.52% 0.84% 0.83% 0.84% 0.69% 0.75% 0.78% 0.75%
Capital adequacy:Net worth ratio** 10.2% 10.4% 10.3% 10.5% 10.7% 10.8% 10.8% 11.1%
* Annualized Quarterly Data**End of period ratio
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Quarterly Results/Forecasts Annual ForecastsActual Results
Housing Finance Reform• Inactivity & FHFA reporting large deposits into Treasury• House:
– Financial Services Chair Hensarling: PATH Act – Winds down FNMA and FHLMC– Removes government guarantee– Incentivizes private capital to step in– Eliminates key financing option for CUs/members
• Senate:– Ten members drafted Corker/Warner housing reform bill– Widely supported by housing/finance groups– Maintains the government guarantee– Replaces FHFA with FMIC (capitalized by premiums collected by issuers)– Establishes the Mutual Securitization Corporation– Requires private capital to take on at least 10% of the first-loss position when
dealing with mortgage securitizations – Chair Johnson and Ranking Member Crapo also are drafting a bill – Hearings on the horizon