The unfolding impact of rates and retirements
These trends are likely to have a major impact on financial services for years to come.
Changes over the last decade have placed tremendous pressure on financial institutions. The rise of fintech competitors, shifting demographics as baby boomers are replaced by millennials, long-tail implications of the pandemic and now a radically different economic environment have created challenges for every financial institution.
Consider that since 2013:
- The number of U.S. credit unions has declined by 28%, according to statistics from the National Credit Union Administration. In this same period, credit union deposits grew more than 100% and loans grew more than 140%. This tells us the industry is not losing relevancy, but smaller institutions face significant challenges.
- Credit unions with assets under $1 billion have seen assets and membership decline precipitously. In 2013, the NCUA reports, these institutions represented 97% of credit unions, 46% of industry loans, 48% of industry deposits and 56% of credit union members. In 2023, they still represented 91% of credit unions, but their share of loans, deposits and members declined to 23%, 25% and 29%, respectively.
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