Recession! What Recession? Credit Union Lending Records Being Smashed So Far in 2022

MADISON, Wis.–Credit unions are smashing records when it comes to lending so far in 2022.

In the 31 years CUNA has collected monthly data on credit union performance, Deputy Chief Advocacy Officer for Policy Analysis and Chief Economist Mike Schenk said the numbers go way beyond anything that had been forecast for this year at the end of 2021.

“The results of the data really reflect the continuation of trends we have reported. The trends are really important and in a lot of respects surprising given the volatility we see in the economy overall and the concern people have over a recession,” Schenk said.

But there’s nothing resembling a recession among credit union members when it comes to borrowing.

CUNA’s data show lending was up 2.4% in June, which as Schenk noted would represent nearly 29% growth over 2022 should the second half of the year match the first.

“That’s the fastest-ever June in 31 years,” said Schenk, noting the average for the month is around 1%.

The previous record for lending growth in any one month was May of this year, when loans were up 2.3%.

Meanwhile, overall loan growth came in at 10.2% for the first half of the year among credit unions.

A Whole Year in 6 Months

“That’s a little bit more than we thought loans would grow for the entire year  when we put forecast at end of 2021,” said Schenk. “That’s the fastest first half in credit union history. The previous record was 5.9% for the first half of 1994. The interesting thing about that is in 1994 we were in almost the exact same economic position. We were coming out of a recession and inflation pressures had spiked. The Fed stepped in and began to raise rates aggressively, 330 basis points over a year…There was fear of a recession then that did not happen for three or four years after. That gives us hope looking forward that even though the Fed is raising rates we may be able to sidestep economic downturn.”

More Good News

A big driver of lending in the first half of the year were auto loans, which were up 12%, or 24% annualized. The previous record for auto loans over the first half of a year was 11.3% in 1994, according to the CUNA data, Schenk said.

“Overall, there is some really good news in monthly credit union data,” said Schenk. “We’re also seeing loan quality overall maintained. The overall delinquency rate stood at .24%, an all-time low for the fourth consecutive month.”

More detail on CUNA’s Monthly credit Union estimates can be found here.