A (Asset Quality)

It takes 15 months for the Inverted Yield curve to show up in economic data. Thus writes Tom McClellan, Editor, The McClellan Market Report in a February 20, 2020 article in his newsletter.

According to a study by the NCUA’s Chief Economist, credit union members could save thousands of dollars on their mortgages when compared to borrowers at other financial institutions.

Jacob Passy writes in a January 26, 2020 article in marketwatch.com that upcoming changes in FICO’s credit scoring system will have an impact on many consumers and lenders.

Ray Birch writes, in a January 5, 2020 article on cutoday.info, “Experian early this year will introduce a new credit score product it says will help financial institutions make loans to more credit invisible and thin-file consumers—a huge market of more than 100-million people.”

A December 12, 2019 article in americanbanker.com reports: “U.S. business debt exceeded that of households for the first time since 1991, a potential warning sign for the economy as corporate investment softens”.

Credit union managers should be constantly checking their balance sheets and loan portfolios for early warning signs of impending reductions in earnings and/or increases in loan losses.

Jim DuPlessis, in a November 7, 2019 article on cutimes.com writes “The Fed’s G-19 Consumer Credit Report showed credit unions held $64.4 billion in credit card debt on Sept. 30, up 6.9% from a year earlier. Credit unions’ share was 6.2% in September, about the same as August and up from 6% in September 2018”.

Tina Orem, in a December 9, 2019 article on cutimes.com, writes that credit unions are less efficient than banks and thrifts when it comes to assets per employee, according to new data from financial institution research firm Moebs Services.

Jim DePlessis writes in a December 5, 2019 article in cutimes.com that mortgage loans have been doing relatively well  for lenders in 2019 but auto loans have decreased from a year ago.

Credit unions (particularly smaller credit unions) will find it more difficult to compete in a shrinking auto loan market.  Fortunately, there are ways to profitably reach deeper into the auto loan pool by effectively pricing risk into lower credit-grade loans.

David Bauman, in a November 13, 2019 article in cutimes.com, writes “The Small Business Administration failed to review many of its high-risk lenders between 2015 and 2017, placing billions of dollars of loan guarantys (sic) at risk, the agency’s Inspector General said, in a just-released report.”