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Ohio CUs MBLs grew 20.1 in 1Q
COLUMBUS, Ohio (7/20/11)--Ohio credit unions posted a strong first-quarter financial performance, in line or better than national credit union trends, as financial institutions operate within a more “normal” economic environment, according to the Ohio Credit Union League’s (OCUL) Quarterly Performance Summary. Annual growth figures for assets, shares, and loans through the first quarter of 2011 all exceed or are similar to national averages, with member business lending origination showing a $23.7 million gain (20.1%) from March 2010 to March 2011, the report indicated. “Growing, progressive and modern is how Ohio credit unions are best described today,” said Paul Mercer, OCUL president. “Despite a difficult economy and regulatory pressures, Ohio credit unions are thriving by creating financial products and services designed to help members, and member businesses, succeed. This model has worked well for 75 years, and will continue to benefit our state’s nearly three million members.” Small-business lending is becoming an increasingly important part of a credit union’s suite of products, the league said. During the first quarter, Ohio credit unions originated $28.4 million in business loans, up from the $23.7 million reported during the first quarter of 2010. As of March 31, about 101 of Ohio’s 384 credit unions reported outstanding business loan balances, totaling $386.6 million. Business loan balances in Ohio grew 8.3% from the previous March, which is faster than the national average (6.4%) during the same period. “Ohio small businesses are in need of credit to help them sustain, grow and create jobs. Credit unions are in a strong position to lend, and have embraced the need,” Mercer said. “With congressional help, we can do more.” The Credit Union National Association (CUNA) and credit unions are pressing Congress to increase credit unions’ MBL cap to 27.5% of assets from 12.25%. Doing so would open up more opportunity to offer MBLs, inject $13 billion in loans into the economy and create as many as 140,000 new jobs, with no cost to taxpayers, CUNA said. Ohio credit unions originated $329 million in first mortgages in the first quarter, 2011, up 33.4% from the same period in 2010. The new originations propelled outstanding first mortgages 5.7% to $4.2 billion at the state’s credit unions. Year to date, U.S. credit union first- mortgage loan originations increased 12.7% from March 2010, with Ohio credit union originations ticking higher at 14%, a $1.2 billion increase over the previous year. Credit unions in Ohio have historically reported above-average auto loan growth and have avoided the large declines experienced nationally, with balances rising by 1.3% annually. Similar to national trends, growth was reported exclusively in the used-auto loan portfolio. Used-auto loan balances in Ohio increased 6.6% annually, as new-auto balances fell 6.7% during the past 12 months. Asset quality in Ohio remains strong, with the delinquency rate falling to 1.21% from the reported 1.36% in March 2010. Delinquency in Ohio remains well below the national average of 1.63%. Credit card delinquencies declined 39 basis points the past 12 months to 1.33% as of March. Credit card balances also posted growth during the year, as balances increased 3.2% annually to $722 million as of March. Credit unions in Ohio added 30,749 members over the past year, growing membership by 1.2% to 2.69 million members. That growth rate was more than double the national average of 0.56%. The first-quarter statistics mark the ninth straight quarter in which Ohio has seen membership growth, after years of relatively flat growth. Credit unions in Ohio and nationally have seen total revenue slide during the past year because of historically low interest rates. Total revenue for Ohio credit unions fell 2.7% to $283 million during the first quarter. However, Ohio credit union economic indicators remain positive overall, with capital levels at 10.93% on average, which is higher than Ohio banks and thrifts, and credit unions and banks nationally, said the league.


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