Preparing your credit union for surpassing the $10 billion asset threshold

Over the course of the pandemic, credit unions have seen their balance sheets grow at an accelerated pace. This has been fueled by COVID-related policy response, including multiple stimulus payments and a sustained period of low interest rates.

This impact can be seen in the number of $10 billion credit unions in the United States, which has nearly doubled in the 18+ months of the pandemic. In December 2019, there were 10 credit unions above the $10 billion mark, while as of the June 2021 Call Report data, there are now 19 credit unions above the threshold. More and more credit unions are on track to surpass it, with 18 credit unions in the $7.0–$9.9 billion range and poised to reach the mark within the next few years.

The $10 billion threshold is part of the Dodd-Frank Wall Street Reform and Consumer Protection Act (Dodd-Frank), which was signed into law in July 2010 and aimed at implementing go-forward corrections following the financial crisis and recession over the preceding three years. The threshold is a trigger to invoke heightened risk management, regulatory oversight and scrutiny, including direct supervision from the newly created Consumer Financial Protection Bureau (CFPB). Surpassing the threshold unlocks aspects of certain regulations that impact credit union revenue generation.

As such, reaching and surpassing the $10 billion threshold brings about very significant implications for credit unions in terms of complexity, increased costs and pressures on revenue, all of which impact the entire organization, from the Board to front-line staff. Preparing to surpass this threshold is a complex undertaking requiring multiple years of commitment.


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