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Credit Unions 2021Credit Unions Recovering NicelyAlthough total Q4 2020 originations of $179 billion for first mortgages and auto, consumer and commercial loans were slightly lower than Q3’s $184 billion, Q4 2020’s total originations increased 19% from Q4 2019.Financial data for Q1 2021 were very encouraging as loan originations totaled $182 billion and first mortgages increased 49% from Q1 2020 and other loans increased 21%. A somewhat positive trend was loan losses from delinquencies were the lowest for five years.The entire credit union industry’s net worth increased 8.3% YOY ($14.9 billion) during Q1 2021 to a total of $195.3 billion while net income for all federally insured credit unions increased 134.9% YOY and, again, attributable to a much lower loan delinquency rate. Primary Financial Metrics for Federally Insured Credit Unions, Q1 2021MetricTotalYOY ChangeMetricTotalYOY ChangeCredit unions5,068-2.4%Total loans outstanding$1.17 T+4.4%Total assets$1.95 T+19.0% Residential$511.4 B+4.4%Net income$19.7 B+134.9% Auto$380.7 B+1.7%Insured shares and deposits$1.56 T+22.4% Credit card balances*$58.7 B-8.9%Total investments$396.3 B+42.5% Commercial loans$97.4 B+14.4%National Credit Union Administration, March 2021*a positive trendChallenges RemainWith millions of Americans using more ATMs and digital banking during 2020, the 4% decrease in credit union customers’ satisfaction from a July 2020 Foresight Research survey is unsurprising. Credit unions, like banks, found it difficult to pivot to the digital mode.Americans are expected to continue to save more during 2021, which is good for credit union assets, but will cause loans to stagnant. The microchip shortage and other automotive supply chain issues depressed April 2021 credit union auto loans by 5.6% YOY.The Credit Union National Association (CUNA) increased its net-income forecast for 2021 and 2022 from February 2021 (0.50%) and April 2021 (0.60%) to 0.85% for both years, compared to 0.71% for all of 2020 and 0.94% for 2019.Declining Share of Credit Card Balances and Auto Loans at Credit Unions, Q1 2021Credit Card BalancesYOY ChangeAuto Loan ShareTotalMarch 2020+1.8%Q1 2020$381 BJune 2020-7.6%Q2 2020$380 BSeptember 2020-9.7%Q3 2020$384 BDecember 2020-11.0%Q4 2020$386 BMarch 2021-9.6%Q1 2021$383 BNational Credit Union Administration, March 2021(color in auto loan related to previous quarter)Credit Union Members InsightsAccording to The Media Audit’s 62-Market 2020 Aggregate Survey, 17.3% of all adults 18+ were credit union members with slightly more women (53.2%) than men (46.8%). The largest percentages by age group were 25–49 (40.2%) and 50–74 (50.7%).In terms of annual household income, there were two primary brackets: $35K to $75K (32.0%) and $75K to $150K (33.7%). Those with incomes of less than $35K were 20.5% and those with incomes of $150K or more were 13.7%.Among credit union members 25–49, 62.4% have children at home of any age, with 36.8% having children 6–12 and 25.3% children 13–17. Among members 50+, 27.4% have children at home of any age, but 47.7% are married and have no children at home. Occupations of Credit Union Members, by Age Group, 2020Occupation25–4950+Occupation25–4950+All white-collar workers55.0%32.9%All blue-collar workers8.4%4.7% Professional/Technical23.1%12.9%Business owner/Partner/ Corporate Officer6.4%4.0% Proprietors/Managers17.4%10.3%Retired1.0%45.5% Clerical/Sales14.5%9.8%Based on The Media Audit’s 62-Market 2020 Aggregate SurveyMedia Engagement with Credit Union MembersUnsurprisingly, adults 50+ who are credit union members spend 36.2% of their media day watching TV and 22% on the Internet while those 25–49 are spending essentially the same amount daily with TV (25.8%) and the Internet (26.1%).Also, as expected, significantly more adults 25–49 who are credit union members watched video streaming during the past seven days (82.5%) than those 50+ (57.3%), and both age groups were watching Netflix the most, or 67.0% and 40.1%, respectively.Credit union members are also sports fans and the NFL is first for both groups watching on TV, or 32.4% and 35.6%, respectively. For those 25–49, MLB was second (22.3%) and NBA third (22.0%) while for those 50+, MLB (26.8%) and college football (22.1%).Adults 25–49 and 50+ Who Are Credit Union Members and Their Social Media Use*, 2020Social Media25–3435–4445–4950–5455–6465+YouTube80.9%82.6%77.1%76.8%71.1%55.8%Facebook72.1%75.8%80.3%71.0%72.4%55.7%LinkedIn35.0%37.6%38.4%33.4%29.5%20.5%Twitter42.3%41.5%41.1%33.9%27.6%15.0%Pinterest46.6%46.5%43.4%39.3%33.3%12.4%Instagram67.2%57.0%47.9%37.4%30.3%12.1%Snapchat45.3%30.9%22.2%16.1%8.5%1.9%Based on The Media Audit’s 62-Market 2020 Aggregate Survey *logged on during past monthUnderstanding Relationships with MembersCredit unions rely heavily on in-person relationships with their members. According to a 2021 Co-Op Financial Services survey of credit union members, 30% said their primary financial relationship was with their credit union, but 30% also said with a fintech.The “digitizing” of credit union members is also reflected in the 25% who said PayPal was their most trusted brand while credit unions were second at 21%. Bank of America was the third most trusted at just 5%, tied with Ally.Even though credit union members are increasingly using digital channels for financial management, 98% would still visit a branch during the future to resolve a problem and 85% trust their credit union the most because there is a nearby branch.10 Most Important Features to Build and Maintain a Primary Financial Relationship with Credit Union Members and Prospects, Q1 2021FeatureFeature#1: Control over personal data#6: Digital identity removal services#2: Virtual access to financial planner#7: Advice on securing personal information#3: As much as $10K instant funding#8: Receive paychecks 2 days early#4: White-glove loan service#9: Free products/services#5: Relationship pricing discount#10: Promotional discount periodCo-Op Financial Services, June 2021More Members Go DigitalMuch like many Americans, credit union members turned to digital devices and channels during 2020 as a July 2020 survey from PSCU found 47% of members were using contactless cards compared to 24% during 2019.More members were using a mobile wallet than non-members or 49% and 28%, respectively, and 57% of members said they were more likely to use a mobile phone to make payments or do banking compared to 35% of non-members.Unsurprisingly, more members (23%) increased their use of a mobile app/online grocery purchases during 2020 compared to before the pandemic (16%) and more members (33%) increased their use of food pick-up/delivery than before the pandemic at 21%.Comparison of Credit Union Members and Non-Members’ Preferred Consumer Payment Method, July 2020PreferenceMembersNon-MembersPreferenceMembersNon-MembersDebit card40%41%Check2%4%Credit card37%33%Gift/Prepaid card2%2%Cash14%19%Store-specific mobile payment app1%0%Mobile wallet3%2%PSCU, October 2020More Valuable InsightsThe National Credit Union Administration publishes extensive data on credit union financial performance by state for Q1 2021. Top 10 States by Credit Unions’ Median YOY Asset Growth, Q1 2021StateGrowthStateGrowth#1: Idaho (tied)+25.5%#6: Minnesota+23.0%#1: Nevada (tied)+25.5%#7: Arkansas+21.3%#3: Arizona (tied)+23.9%#8: Washington+21.2%#3: Oregon (tied)+23.9%#9: Vermont+21.1%#5: South Dakota+23.7%#10: Guam+21.0%National Credit Union Administration, March 2021Top 10 States by Credit Unions’ Median YOY Member Growth, Q1 2021StateGrowthStateGrowth#1: Arkansas (tied)+4.3%#6: Montana+1.3%#1: Idaho (tied)+4.3%#7: South Dakota+1.2%#3: Vermont+2.2%#8: Maine+1.1%#4: Wyoming+2.1%#9: Alabama (tied)+1.0%#5: Nevada+1.8%#9: Minnesota (tied)+1.0%National Credit Union Administration, March 2021Top 10 States by Credit Unions’ Median YOY Loan Growth, Q1 2021StateGrowthStateGrowth#1: Arkansas+10.5%#6: Missouri (tied)+4.0%#2: Idaho+6.7%#6: Wyoming (tied)+4.0%#3: Utah+6.1%#8: Nevada+3.9%#4: Washington+4.8%#9: Guam+3.6%#5: Florida+4.4%#10: Vermont+3.2%National Credit Union Administration, March 2021Sources: Credit Union Times Website, 6/21; National Credit Union Administration Website, 6/21; The Media Audit Website, 6/21; Co-Op Financial Services Website, 6/21; PSCU Website, 6/21.Updated: June 2021? 2021 Media Group Online, Inc. 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