c. myblog

June 17, 2010

Prolonged Low Rate Environment?

For months many have been watching and wondering when the inevitable increase in market rates might materialize.  Now, with some economists projecting that rates will stay at historic lows for another 12-18 months, credit unions should evaluate how, or if, they can continue to maintain net interest margin and ROA. Not all institutions have room […]

June 3, 2010

Are Your Members Sending You A Signal?

According to NCUA’s first quarter data, shares grew an average of almost 11% (annualized) while loan growth declined 4.76% (annualized)─over a 15% differential.  Funds not loaned out are sitting in investments (generally not earning very much) and are putting a squeeze on the margin.  With loan demand down, many of our clients are requesting what-if […]

May 27, 2010

Consumers Shunning Risk

The question that many credit union leaders are asking themselves lately is, how far do we reach for yield?  With 10-year Treasury Rates rounding near 3% recently, how far can the balance sheet be pushed to make up for a squeezing margin? Consumers at large are facing a similar dilemma when it comes to managing […]

May 13, 2010

Mini Age of Austerity?

Consumer behavior, specifically spending statistics, is being tracked with much anticipation these days.  Given that consumer spending accounts for 70% of the economy, this is no surprise.  So what is the forecast? According to a new Associated Press Economy Survey, two-thirds of the 44 economists surveyed believe that the frugality created during the Great Recession […]

April 29, 2010

When is Worst Case?

In risk analysis, it is important to make realistic assumptions about potential bad scenarios that could play out—large increases in interest rates and credit risk exceeding expectations are just a couple that come to mind. While interest rates are at an all-time low, credit risk is at an all-time high for some credit unions. In […]

Start typing and press Enter to search