Credit union loan books show strong growth, says report
Credit Unions are improving efficiency with lower wages-to-income ratios and stronger loan book growth, and most paying a dividend to members, according to 13th Annual Credit Union Benchmarking Report by accountancy firm RBK.
The report, carried out in March and April, reported steady loan growth of 9% for community credit unions, while industrial credit unions demonstrate substantially stronger performance. Home improveent and car loans were a particular strength.
Reserves remain strong with all credit unions exceeding the minimum regulatory requirement of 10%. The verage reserves ratio across community credit unions was 16.6%. The trend of increasing dividend payments has continued, with 62% of surveyed credit unions paying dividends in 2024, a substantial increase on the previous year.
'Financial indicators have shown considerable improvement across the sector. Investment portfolios are trending downward as a percentage of assets, aligned with the shift towards increased lending. This is a positive development for credit unions whose primary mission is providing financial services to members," said RBK partner Ronan Kilbane.
The report found average salary increases of around 4%. Environmental, Social, and Governance (ESG) considerations have become mainstream, with over 80% of credit unions now incorporating an ESG policy into their policy framework.
There were 183 active credit unions at September 2024, a fall of nine from the previous year.
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