All bank and credit union star-ratings are now based on December 31, 2024 financial data.
As both banks and credit unions continue to consolidate, most other measures continue to rise. Our focus this week was on the credit union industry, which registered increases in membership, total assets, loans and shares/deposits.
Insured shares/deposits at the Nation's credit unions grew by 3.4% in 2024 and are now approaching the $2 trillion mark. Those with the most significant increases can be found on page 5 of this week's Jumbo Rate News.
New Credit Union Star-Ratings Are Now Available
Bauer is pleased to report that all star-ratings (both banks and credit unions) have now been updated based on year-end 2024 financial data. We invite you to look up the ratings on all banks and/or credit unions in which you have deposits.
Last week we focused on banks, now it is time to examine credit union changes. Similar to banks, consolidation in the credit union industry continues to deplete its numbers. The last two calendar years have each seen a decrease of roughly 3.25% of the industry. The total 2-year total loss of 6.4% brings the number of federally-insured credit union at year-end 2024 down to 4,455.
That is about the only number that is dropping, though. Most other major measures are showing growth, quite robust growth in some areas.
Total Assets at federally-insured credit unions increased 2.3% in 2024 after a 4.1% increase in 2023. By the close of 2024, industry assets exceeded $2.3 trillion
Total Loan growth has slowed dramatically, both in quantity of loans and in dollars loaned. The number of loans outstanding actually shrunk slightly (0.07%) in 2024 after reporting a 1.7% increase in 2023. The dollar amount of those outstanding loans increased by 6.4% in 2023 and just 2.9% in 2024. Loan amounts outstanding at year-end 2024 totaled $1.6 trillion.
Bad Loans: On the flip side, the amount of loans falling into delinquency status (60 days or more past due), is far outpacing total loan growth. Delinquent loans grew over 20% in 2024, and more than 72% in the last 2 years (from $9.3 billion at 12/31/2022 to $16.04 billion at 12/31/2024).
Net charge-offs have grown even faster—from $4.7 billion at the close of 2022 to $12.99 billion at the end of 2024. That’s a two-year hike of over 176%. Granted, the major part of that growth was in 2023, but it has continued to compound.
We will delve more deeply into this phenomena in coming weeks. For today, we will focus more on insured shares and deposits at our Nation’s federally-insured credit union.
Deposits: Insured shares/deposits grew by 3.4% in 2024 (better than the 2.2% growth in 2023). These insured deposits are now flirting with the $2 trillion mark. That’s interesting as 2023 membership growth (3%) outpaced 2.2% of 2024.
Nevertheless, each of the 50 credit unions listed on page 5 of this issue grew their shares (deposits) by over 23% during calendar 2024. In addition, these credit unions were all established prior to 2015. They are no longer considered de novos, which are expected to see rapid growth. On page 2 we will look at how some of these credit unions were able to grow their shares/deposits in 2024.
3-Star Urban Beginnings Choice FCU, Fort Wayne, IN (24781) was chartered in 2006 as Union Baptist Church FCU in a predominantly African-American part of Fort Wayne. With a Faith-Based associational field of membership (FOM) tied to a single church, growth was very limited. In 2023, it broadened its FOM and changed its name to welcome new, multiple common bonds.
It took 15 years for Union Baptist Church FCU to reach just a half a million in assets. After the name and FOM change (November 2023), word spread. Urban Beginnings Choice FCU ended 2024 with $1.872 million. Deposits increased from $0.389 at the end of 2023 to $1.739 million a year later. Urban Beginnings’ focus is still on the predominantly black community that contains the Church where it all began. While still quite small, Urban Beginnings now has 18% more members and over 300% more deposits than it had at the end of 2023. It continues to provide literacy education, but now it can reach to a much larger segment of that population.
1-Star Symphony FCU, Boston, MA (18861) also has a multiple common bond FOM, but, after peaking in 2017 with around 310 members, Symphony FCU’s membership has been sliding. By the end of 2024, Symphony FCU reported just 211 members. Its deposits do not reflect that drop, but rather fluctuate from quarter to quarter and year-to-year. Deposits at 12/31/2023 were lower than they had been in years. Fortunately they rallied in 2024 and are again approaching their highs of close to $2 million. Unfortunately, with just 1-Star, Symphony FCU is one of 95 institutions relegated to Bauer’s Troubled and Problematic Credit Union Report (credit unions rated 2-stars or below).
Other credit unions, like 4-Star Rivermark Community CU, Beaverton, OR (65644) grew their deposits by way of acquisition. Last October Rivermark acquired Advantis Credit Union, Oregon City, OR with its $1.9 billion in assets and $1.6 billion of deposits. That easily solidified its spot on this list with 148% deposit growth.
While Rivermark has acquired several different credit unions over the years, 5-Star Five Star Credit Union, Dothan, AL (68302) has been acquiring banks (JRN 41:41). Its latest was a double, acquiring both OneSouth Bank, Macon, GA and Wilcox County State Bank, Abbeville, GA in May 2024.
These two additions brought with them more than $300 million in deposits and propelled Five Star CU over the $1 billion mark in both deposits and assets.
