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Jobless rate affects Nashville CUs growth
NASHVILLE (5/11/09)--Tennessee’s unemployment rate might be affecting the growth of Nashville credit unions. Nashville credit unions are growing more slowly than credit unions nationwide. Total assets at Middle Tennessee credit unions rose 3.7% in 2008 from 2007. Nationally, credit unions’ assets increased 7.7% last year. Also, Nashville credit unions’ membership was flat in 2008, while nationally credit union membership grew by 2% (Nashville Business Journal May 8). Because the state’s unemployment rate is about one point higher than the national rate, it could be harming local credit union performance, some in the state’s credit union industry believe. However, some local credit unions are reporting robust first-quarter growth, the Journal said. Cornerstone Financial FCU, with $187.8 million in assets, has experienced a first-quarter upshot in deposits. The growth is attributed to members pulling money out of the stock market or mutual funds, said Cornerstone President Henry Flurry. Cornerstone opened 531 new accounts in the first quarter. “That’s a pretty good growth number for us,” Flurry told the Journal. However, provisions for loan and lease losses at area credit unions rose 129% last year while the national rate was 112%. Area credit unions are anticipating roughly the same degree of loan loss portfolios as credit unions nationwide, Thomas Gaines, president of the Tennessee Credit Union League, told the Journal.
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