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IWSJI CUs more wholesome alternative to banks
NEW YORK (6/8/10)--Credit unions are positioning themselves as “a more wholesome alternative” to banks beset by bailouts and scandals, and as a result are seeing growth, The Wall Street Journal said Saturday. The Journal spotlighted better rates, lower fees, and attentive service at credit unions, compared with banks on many products. “With their fatter yields and lower fees, credit unions are having little trouble attracting depositors these days,” wrote Jane J. Kim in an article titled, “Credit Unions: A Better Bet Than Banks?” “Credit unions are seeing big growth in their deposits, as their share of the total U.S. household savings climbs,” Kim added. “Credit unions’ share of the total household-savings market climbed to 10% in March, from 9.5% a year earlier, according to a Wall Street Journal analysis of data from the Federal Reserve, the National Credit Union Administration and the Treasury Department.” However, credit unions haven’t gone completely unscathed by the financial crisis, Kim wrote. Many are experiencing higher loan losses, while several corporate credit unions sustained large losses in mortgage-backed securities. “We have been collateral damage just like everyone else,” Bill Hampel, chief economist at the Credit Union National Association, told the Journal. “Even the good, old-fashioned standard conventional mortgages were severely affected by the sharp declines in home prices.” At credit unions, consumers can find and get more yield on their money or reduce their interest payments in the areas of deposits, mortgages and home equity lines of credit, auto loans and credit cards, Kim wrote. The article mentions Summit CU, Madison, Wis., for its lower fees and great service, and Otero FCU, Alamogordo, N.M., for it deposit growth. Otero has seen growth of 8% to 10% in the past year. To read the article, use the link.
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