c. myblog

June 13, 2018

Are Net Interest Income (NII) Simulation Pricing Assumptions Producing Optimistic Results?

We perform many model validations each year.  In most income simulations, it is assumed that all new volume loan rates will move at 100% of the change in market rates.  However, recent trends show that the “typical” new volume assumptions used by many credit unions are not representative of what is happening.  This can cause […]

May 30, 2018

What Should We Do About Interest Rate Risk? First, Don’t Panic.

The following blog post was written by c. myers and originally published by CUES on May 17, 2018. For the last 10 years, credit unions have dutifully modeled, monitored, and made decisions to keep interest rate risk under control. And interest rates didn’t move. Looking back as far as the early 1970s, rates have never […]

May 9, 2018

Are Investments Now Yielding More Than Indirect Autos?

For many credit unions, taking a serious look at indirect auto profitability is long overdue.  Two years ago it was easier to make the argument that indirect autos were a better financial alternative than a like-term investment.  Now, the issue is more complicated as investment yields have increased far more than auto yields in the […]

April 26, 2018

Is ARM Refinancing Set to Increase?

Last week we posted a blog on the evolving mortgage landscape, focusing on changing consumer behaviors and expectations.  This blog addresses a more specific aspect of mortgage lending, the likelihood that due to increases in mortgage rates, financial institutions will see an increase in existing adjustable rate mortgages (ARM) that refinance, as well as an […]

April 4, 2018

Keep Your Economic Engine Running

Credit unions have been laser focused on fine-tuning their main economic engine – lending – and many have been very successful. Loan demand is strong and liquidity is tightening. After years of attention to the engine, it’s time to put that same level of focus on the fuel. Without affordable sources of funding, that big, […]

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