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TransUnion Survey: CUs Cite Loan Growth as Most Important Business Issue in 2014
Monday, April 21, 2014 7:00 AM

A new TransUnion survey reveals that nearly three-fourths (72 percent) of credit union executives who attended a recent industry meeting identified loan growth as the most significant issue facing the credit union industry in 2014, with nearly half of respondents (49 percent) citing loan growth as the singular most critical issue. The survey was completed by 64 executives at the CUNA Governmental Affairs Conference in Washington, D.C. in late February.

Among the industry executives surveyed, more than half (57 percent) identify auto loans as the biggest opportunity for growth. Trailing by a wide margin were deposit accounts, which were the second most frequently cited by significant business opportunity among survey respondents.

The results of the survey of industry executives are consistent with TransUnion's recent Industry Insights Report (IIR), released in mid-March, which found that while the auto loan debt-per-borrower and delinquency rate increased, they remain at relative historic lows. The national auto debt-per-borrow rose to $16,769 in Q4 2013 from $16,060 in Q4 2012, marking 11 consecutive quarterly increases. The auto loan delinquency rate also increased -- rising to 1.14 percent in Q4 2013 from 1.04 percent in Q3 2013 and 1.09 percent in Q4 2012. The IIR is TransUnion's quarterly overview summarizing data, trends and perspectives on the U.S. consumer lending industry. The report is based on anonymized credit data from virtually every credit-active consumer in the United States. 

What's more, TransUnion's recent annual Payment Hierarchy study, which evaluates the priority in which borrowers repay mortgage, credit and auto debt, found that consumers place a steady emphasis on paying their auto loans before their mortgages and credit cards. In fact, consumers have repaid auto loans at a higher rate since at least 2003, when the study was first conducted.

Additional concerns cited by credit union executives include:

  • Increased regulation: Regulation was cited by 34 percent of respondents as their biggest challenge to loan growth in 2014, making it the second most cited top challenge. In all, regulation was cited by more respondents (57 percent) as being among their top challenges than any other issue. 
  • Expanding membership: Concerns among credit union executives about expanding membership increased by 26 percent in 2014 (from 6 percent in 2013 to 33 percent in 2014).
  • Competition for greater market share: 54 percent of respondents cited competition as their biggest challenge to loan growth in 2014, up from 40 percent in 2013.