All Investments Are Not Created Equal

     Investment rates are at a record low, and credit unions across the country are deploying different ways to make the most of excess funds; however, it is difficult to find a solid return these days. Currently, the industry averages a 1.14% return on investments. That’s less than a quarter of what the industry average was in 2007. So what makes some strategies outperform others? A dive into data from the 5300 Call Report offers some guidance.
     In the comparisons below, credit unions are divided into quartiles based on their investment return. The average asset size in the quartiles ranges from $88.1 million for the bottom quartile to $245.8 million for the largest quartile. The top quartile posted an average return of 1.63% as of Dec. 31, 2013. That’s 49 basis points above the credit union industry average and is more than four times the return of the bottom quartile.
INVESTMENT RETURN BY QUARTILEData as of December 31, 2013

© Callahan & Associates | www.creditunions.com
Source: Callahan & Associates’ Peer-to-Peer Analytics
Read the complete article at; All Investments Are Not Created Equal - General Features - News | Credit Unions

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