Lending, Assets, Insured Shares, and Delinquencies Rise

NCUA Releases Credit Union System Performance Data for the Third Quarter of 2023

According to the latest financial performance data released today by the National Credit Union Administration, total loans outstanding in federally insured credit unions increased $132 billion, or 9.1 percent, over the year ending in the thirdquarter of 2023, to $1.59 trillion. Total assets rose by $79 billion, or 3.7 percent, to $2.23 trillionduring the same period. Insured shares and deposits increased $23 billion, or 1.4 percent, to $1.72 trillion, from one year earlier. Also, for the third quarter of 2023, the delinquency rate was 72 basis points, up 19 basis points from one year earlier.

“The credit union system remains largely stable in its performance and is relatively resilient against economic disruptions,” NCUA Chairman Todd M. Harper said. “However, the NCUA is seeing growing signs of financial strain on credit union balance sheets and household budgets, along with growing consumer financial stress as reflected in the rising delinquency rate. Credit card and auto loan delinquencies are elevated at 190 and 78 basis points, respectively.

“The NCUA continues to monitor credit union performance closely and urges credit unions to remain diligent in managing the potential risks on their balance sheets and when monitoring economic conditions and the interest rate environment. Credit unions should also work with their members who are experiencing financial stress as early intervention can prevent a delinquency from becoming a charge-off. Clearly, today’s economic environment requires active — not passive — management by all.”

The NCUA’s Quarterly Credit Union Data Summary provides an overview of the financial performance of federally insured credit unions based on information reported to the agency in the third quarter of 2023. As of September 30, 2023, there were 4,645 federally insured credit unions with 138.8 million members.

Highlights from the NCUA’s Quarterly Data Summary Report for the third quarter of 2023include:

• Net income for federally insured credit unions in the first three quarters of 2023 totaled $16.6 billion at an annual rate, down $1.9 billion, or 10.3 percent, from the first three quarters of 2022. Interest income rose $27.9 billion, or 41.4 percent, over the year to $95.3 billion annualized.  

• The credit union system’s provision for loan and lease losses or credit loss expense increased $5.5 billion, or 125.5 percent, to $9.9 billion at an annual rate in the first three quarters of 2023.

• Total loans outstanding increased $132.0 billion, or 9.1 percent, over the year to $1.59 trillion. Credit union loan balances rose in most major categories, compared with the third quarter of 2022. The rate of growth, however, has slowed compared to recent quarters.

• Total shares and deposits rose by $16.1 billion, or 0.9 percent, over the year to $1.88 trillion in the third quarter of 2023. Regular shares declined by $91.1 billion, or 13.4 percent, to $588.0 billion. Other deposits increased by $118.7 billion, or 15.0 percent, to $910.5 billion, led by share certificate accounts, which grew $185.9 billion, or 72.0 percent, over the year to $444.2 billion.

• The credit union system’s net worth increased by $11.4 billion, or 5.0 percent, over the year to $239.2 billion. The aggregate net worth ratio — net worth as a percentage of assets — stood at 10.73 percent in the third quarter of 2023, up from 10.60 percent one year earlier.