ALEXANDRIA, Va. (1/10/13)--Americans are becoming more aware of how critical credit unions are, and this increased interest "explains why credit unions have added nearly three million members since 2010," National Credit Union Administration (NCUA) Chairman Debbie Matz said in a new LEADERS magazine interview.
"Members know that they can usually get a better deal at a credit union," Matz said. She noted that cooperative, not-for-profit credit unions generally charge lower interest on loans, pay higher dividends on deposits, and are an excellent source for small business loans. "With the average business loan only $220,000, credit unions often make loans that banks turn away. In fact, while other institutions cut back lending during the financial crisis, credit unions gained further recognition as the only insured institutions to increase lending," she added.
LEADERS is a quarterly magazine featuring interviews about the thoughts and visions of leaders in government, business, academia, labor, religion, science and the arts. The state of the credit union movement and the agency's response to the financial crisis are also addressed in the interview.
The NCUA Chairman noted the agency "needed to act decisively to stabilize the credit union system" when the financial crisis hit in 2008. "Approximately 2,200 of the 7,000 credit unions were at risk, so we had to stabilize the system by rigorous supervision, rather than by regulation, which takes time," Matz added.
Credit unions weathered the financial crisis and its aftereffects, and the credit union industry is "exceptionally well-capitalized at over 10%," she noted. "Return on assets is 86 basis points, up from 18 basis points when I became chairman; and loan delinquencies and charge-offs are trending in the right direction--down," she added.
"These metrics indicate that the credit union industry is resilient and in a strong position," Matz said.
For the full LEADERS interview, use the resource link.