Michigan Credit Unions Report Best Year in Membership and Loan Growth in Decades
Lansing, MI (March 31, 2017) While U.S. economic growth slowed in the fourth quarter, Michigan credit unions reported strong membership growth, solid loan growth, high asset quality and healthy earnings results. Beyond fourth quarter growth, Michigan saw full-year membership and loan progress in 2016 that we haven’t seen in decades.
CUNA estimates that Michigan credit unions provided an estimated total of $374 million in direct financial benefits to their 105 million members during calendar-year 2016. These benefits arise largely from the unique credit union structure: the state’s member-owned credit unions offer lower interest rates on loans, higher yields on savings accounts and charge fewer (and lower) fees compared to for-profit stockholder-owned banks. One example: lower interest rates at credit unions mean that, on average, a $30,000 car loan with a 5-year term at a Michigan credit union saved members approximately $120 per year (or $600 over the life of the loan).
Memberships continue to climb, with a 0.7 percent increase in the quarter, which exceeds membership growth at the same time last year. In fact, the 3.6 percent growth for 2016 is the fastest increase seen since 1987. Further, the growth rate of Michigan memberships in 2016 far outpaced the state’s rate of population growth.
Total membership growth by area:
Alpena: 1.2 percent
Detroit: 2.2 percent
Grand Rapids: 7 percent
Lansing: 1.7 percent
Marquette: -0.3 percent
Muskegon: 0.4 percent
Traverse City: 3.9 percent
Michigan credit union loan portfolios also rose, showing a 2.4 percent growth in the final quarter of 2016. While a bit slower than the 3.3 percent 3Q increase, the result bested the 2015 4Q increase of 1.8 percent.
Fourth quarter loan increases by category:
Total Loans: 11.5 percent
Credit Cards: 5.5 percent
Other Unsecured Loans: 3.4 percent
New Car: 3.8 percent
Used Car: 2.1 percent
First Mortgage: 2.5 percent
Member Business Loans: 4.1 percent
Overall, credit union loans in the state increased 11.5 percent during 2016. The last time full-year loan growth exceeded this pace was 1994, when the state’s credit unions reported a 15.9 percent jump in loan balances.
“With memberships growing faster than the state population, it’s obvious that Michigan has a serious need for credit unions,” said Michigan Credit Union League President and CEO Dave Adams. “The increase in loans across the board in 2016 proves that we will be there, providing our members and communities with low-cost, high-quality products and services.”
View the fourth quarter report in full here.
About the Michigan Credit Union League & Affiliates
Organized in 1934, the Michigan Credit Union League is a trade association representing Michigan’s Credit Unions. Based in Lansing, the MCUL works to build awareness of these locally owned, cooperative institutions and their mission to support members, communities and local businesses. For more information, visit mcul.org, follow us on Facebook at facebook.com/MICreditUnions and connect with us on Twitter at twitter.com/MICreditUnions.