Rise in Consumer Installment Credit Boosts Loan Growth
by. Michelle A. Samaad
Roughly 68% of all credit union loan growth during the past year was attributable to the 8.8% rise in consumer installment credit.
According to CUNA Mutual Group’s August Credit Union Trends Report, 81% of that gain came from the $16.6 billion increase in vehicle loans.
However, credit cards, unsecured loans and student loans were also in positive territory, noted the report, which tracked data through June.
Consumer installment credit has now increased $33 billion (15.3%) from its low point in March 2011.
Meanwhile, member business loan portfolios continued to expand but at a slower rate, wrote Dave Colby, CUNA Mutual chief economist, in the report. Annual growth stood at 3.7% in June with the portfolio accounting for 7.6% of annual loan growth.
Still, there may be some trepidation about mortgage lending activity.
“We are somewhat concerned that fixed-rate first mortgages accounted for almost 42% of annual loan growth,” Colby said, adding the increase was 53% on a year-to-date basis.continue reading »