CREDIT UNION INDUSTRY STATISTICS AND PERFORMANCE TRENDS REPORT 2 ND QUARTER 2018 CUDATA.COM Data Intelligence and Industry Insights for Credit Union Management 600 E Sumac Avenue, Provo, UT 84604
# of Credit Unions # of Credit Unions as of June 30,2018 8,000 7,000 6,000 5,000 4,000 3,000 6,560 6,284 6,011 5,815 5,596 2,000 1,000 0 Change in # of Credit Unions (Year-Over-Year) For Asset Class CU's Jun-17 Jun-18 50 0-50 -100 Under $2M $2M-$10M $10M-$50M $50M-$100M $100M-$500M $500M+ All CU's 25 22 13 0-8 -27-40 -42-80 -90-84 -104-150 -200-250 -196-219 Source: CUDATA.COM 2 nd Quarter 2018 Page 2
# of Credit Unions 7000 # of Credit Unions Trend by Asset Class Peer Groups 6000 5000 4000 3000 2000 457 1,068 766 2,162 477 1,068 754 2,055 504 1,071 741 1,937 529 1,071 754 1,847 551 1,063 727 1,763 1000 0 1,415 1,307 1,206 1,102 1,022 692 623 552 512 470 Under $2M $2M-$10M $10M-$50M $50M-$100M $100M-$500M $500M+ Peer Group Asset Size # of CU's % of Total CU's Total Assets ($) % of Total Assets # of Members % of Total Members 1 Under $2M 470 8.4% $ 426,040,000 % 150,168 0.1% 2 $2M -- < $5M 463 8.3% $ 1,622,700,000 0.1% 339,122 0.3% 3 $5M -- < $10M 559 1% $ 4,136,040,000 0.3% 680,763 0.6% 4 $10M -- < $20M 714 12.8% $ 10,359,670,000 0.7% 1,420,259 1.2% 5 $20M -- < $50M 1,049 18.7% $ 33,951,640,000 2.3% 3,885,104 3.4% 6 $50M -- < $100M 727 13.0% $ 52,262,840,000 3.6% 5,553,028 4.8% 7 $100M -- < $150M 348 6.2% $ 42,815,030,000 3.0% 4,210,424 3.6% 8 $150M -- < $250M 361 6.5% $ 70,318,710,000 4.9% 6,723,894 5.8% 9 $250M -- < $350M 186 3.3% $ 55,467,680,000 3.8% 5,072,270 4.4% 10 $350M -- < $450M 116 2.1% $ 46,179,400,000 3.2% 4,223,354 3.7% 11 $450M -- < $650M 155 2.8% $ 83,420,680,000 5.8% 7,224,801 6.3% 12 $650M -- < $850M 92 1.6% $ 68,570,480,000 4.7% 5,493,870 4.8% 13 $850M -- < $1B 51 0.9% $ 46,920,850,000 3.2% 3,842,481 3.3% 14 $1B -- < $2B 177 3.2% $ 244,575,960,000 16.9% 18,615,068 16.1% 15 $2B -- < $4B 79 1.4% $ 216,907,580,000 15.0% 16,554,160 14.3% 16 Over $4B 49 0.9% $ 468,433,140,000 32.4% 31,389,038 27.2% TOTAL Asset-Based Peer Group Statistics As of June 30,2018 5,596 10% $ 1,446,368,440,000 10% 115,377,804 10% Source: CUDATA.COM 2 nd Quarter 2018 Page 3
Number # of Credit Union Branch Offices 25,000 20,000 15,000 20,546 20,601 20,608 20,680 20,898 10,000 5,000 0 The Credit Union Industry as of June 30, 2018 As of 6/30/2018 6-Month $ Growth 6-Month % Growth (Annualized) 12-Month $ Growth 12-Month $ Growth Members 115.4M 2.7M 4.8% 4.7M 4.3% Assets $1,446.4B $51.0B 7.3% $79.5B 5.8% Loans $1,013.1B $45.2B 9.4% $89.9B 9.7% Shares $1,222.3B $48.6B 8.3% $62.6B 5.4% Investments $359.6B $4.6B 2.6% -$14.8B -4.0% Capital $159.3B $6.4B 8.3% $11.7B 7.9% Source: CUDATA.COM 2 nd Quarter 2018 Page 4
In Billion % Total Revenue Growth Trend (In Billion) $4 $35.0 $3 $25.0 $2 $15.0 $1 $5.0 $ 13.2% $5.5 $4.6 $4.3 $4.3 $4.0 $4.1 8.8% $3.4 $3.8 8.0% $3.6 $3.6 7.0% $26.2 $18.4 $19.4 $21.1 $23.1 1.1% 14.0% 12.0% 1% 8.0% 6.0% 4.0% 2.0% % Interest Income Fee Income Other Operating Income Revenue % Growth 1 0.9 0.8 0.7 0.6 0.5 0.4 0.3 0.2 0.1 0-0.1 Return on Avg Assets (Annualized) by Asset Class Peer Groups 0.99 0.90 0.67 0.54 0.43 2 0.12 Source: CUDATA.COM 2 nd Quarter 2018 Page 5
In Billions Net Income Trend - (Year - To - Date) in Billions $7.00 $6.39 $6.00 $5.00 $4.47 $4.67 $4.81 $5.15 $4.00 $3.00 $2.00 $1.00 $0 1.00 Return On Assets (ROA %) Trend 0.90 0.80 0.70 0.60 0.50 0.40 0.30 0.20 0.10 0.81 0.81 0.77 0.77 0.90 0 Source: CUDATA.COM 2 nd Quarter 2018 Page 6
In Billions Net Worth Ratio Trend (%) 12.0 10.8 10.9 10.9 10.8 11.0 1 8.0 6.0 4.0 2.0 $16 $14 $12 $10 $8 $6 $4 $2 $ Net Worth Capital Growth Trend 8.3 7.6 7.3 7.0 7.1 7.9 7.1 7.4 6.8 7.1 $120.3 $129.2 $137.9 $147.7 $159.3 9.0 8.0 7.0 6.0 5.0 4.0 3.0 2.0 1.0 Total Net Worth ($) 6-Month YTD % Growth (Annualized) 12-Month YOY % Growth Source: CUDATA.COM 2 nd Quarter 2018 Page 7
In Billions In Millions 14 Membership Growth Trend 6.0 12 10 8 6 4 3.6 3.6 2.9 3.1 4.2 3.7 4.4 4.8 4.2 4.3 5.0 4.0 3.0 2.0 2 1.0 99.2 102.3 106.2 110.6 115.4 # of Members 6-Month YTD % Growth (Annualized) 12-Month YOY % Growth Asset Growth Trend $1,60 $1,40 $1,20 $1,00 7.8 8.8 8.2 8.4 7.4 7.6 5.9 7.3 5.8 1 9.0 8.0 7.0 6.0 $80 4.5 5.0 $60 $40 $20 $1,117.1 $1,182.6 $1,270.3 $1,366.9 $1,446.4 4.0 3.0 2.0 1.0 Total Assets ($) 6-Month YTD % Growth (Annualized) 12-Month YOY % Growth Source: CUDATA.COM 2 nd Quarter 2018 Page 8
IN BILLIONS In Billions Loan Growth Trend $1,20 $1,00 9.8 10.6 10.5 10.8 9.7 12.0 1 $80 8.9 9.2 9.3 9.9 9.4 8.0 $60 6.0 $40 4.0 $20 2.0 $682.0 $754.1 $833.3 $923.3 $1,013.1 Total Loans ($) 6-Month YTD % Growth (Annualized) 12-Month YOY % Growth Loan Origination by Loan Types - (Year-To-Date) $20 $15 $10 $5 Consumer $110.7 $117.2 $131.5 $143.0 $158.1 1st Mortgage $41.4 $61.8 $62.9 $67.5 $68.9 Other Real Estate $10.6 $12.2 $13.9 $16.2 $17.1 MBL's $8.1 $8.8 $10.3 $13.1 $11.2 Consumer 1st Mortgage Other Real Estate MBL's Source: CUDATA.COM 2 nd Quarter 2018 Page 9
In Billions $30 $25 $20 $15 Loans Granted (Year-to-Date) All Loans vs. Real Estate Loans (In Billions) $170.7 $200.1 $218.5 $239.8 $255.3 $10 $5 $51.9 $74.0 $76.7 $83.7 $86.0 Total Loans Total Real Estate Loans 9 Total Loans to Total Deposits (%) 8 7 6 5 4 3 71.6 75.4 77.7 79.6 82.9 2 1 Source: CUDATA.COM 2 nd Quarter 2018 Page 10
In Billions In Billions Auto Loan Growth Trend $40 18.0 $35 $30 $25 $20 $15 $10 14.3 13.4 13.7 13.9 15.4 14.1 13.0 13.6 11.7 10.6 16.0 14.0 12.0 1 8.0 6.0 4.0 $5 $214.9 $248.1 $283.0 $321.4 $355.5 2.0 Total Auto Loans ($) 6-Month YTD % Growth (Annualized) 12-Month YOY % Growth New Auto vs. Used Auto Loan Growth Trend $40 $35 $30 $25 $20 12.5 17.6 12.915.2 13.7 14.4 13.5 12.7 10.912.2 2 18.0 16.0 14.0 12.0 1 $15 $10 $5 $214.9 $195.5 $174.8 $154.4 $136.6 $78.3 $93.6 $108.2 $125.8 $140.6 8.0 6.0 4.0 2.0 New Auto New Auto % YTD Growth (Annualized) Used Auto Used Auto % YTD Growth (Annualized) Source: CUDATA.COM 2 nd Quarter 2018 Page 11
In Billion $25 $20 $15 Indirect Auto Loan Growth Trend 21.9 21.3 20.9 20.3 20.3 20.3 20.9 19.4 16.7 17.5 25.0 2 15.0 $10 1 $5 5.0 $ $102.9 $125.4 $151.6 $182.3 $212.8 Total Indirect Auto Loans ($) 6-Month YTD % Growth (Annualized) 12-Month YOY % Growth Auto vs Real Estate Loan % Growth Trend ( Annualized) 14.3 13.7 13.9 13.0 11.7 6.5 7.8 7.3 8.9 9.1 Auto Loans Real Estate Loans Source: CUDATA.COM 2 nd Quarter 2018 Page 12
In Billion Member Business Loan Growth Trend $7 18.0 $6 $5 $4 13.3 10.2 12.8 16.8 12.1 16.0 14.0 12.0 1 $3 8.0 $2 $1 $43.6 $49.0 $56.4 $65.8 $58.9 6.0 4.0 2.0 - Total Member Business Loans ($) 6-Month YTD % Growth (Annualized) Loan Portfolio Composition As of June 30,2018 8% 0% 6% 1% 6% 0% 1%4% Unsecured Credit Card Loans Payday Loans 14% Non-Fed Student Loans Other Unsecured Loans New Auto Loans 35% 4%0% 21% Used Auto Loans Leases Receivable All Other Secured Non RE Loans/LOC Source: CUDATA.COM 2 nd Quarter 2018 Page 13
In Billions 1.20 Loan Delinquency and Net-Charge Offs Trend 1.00 0.80 0.85 0.74 0.75 0.75 0.67 0.60 0.40 0.49 0.46 0.51 0.56 0.6 0.20 0 Delinquent Loans To Total Loans Net Charge Offs to Avg. Loans Provision for Loan Losses ($) in Billions (Year-To-Date) $3.50 $3.00 $2.88 $3.39 $2.50 $2.26 $2.00 $1.50 $1.36 $1.70 $1.00 $0.50 $0 Source: CUDATA.COM 2 nd Quarter 2018 Page 14
In Billions 1.2 1.0 1.1 Loan Loss Reserves Trend (Allowance for Loan Losses) 0.9 0.9 0.9 0.9 0.8 0.6 0.6 0.6 0.6 0.6 0.6 0.4 0.2 Allow For Loan Losses to T/Loans Allow For Loan Losses To T/Assets $1,40 $1,20 $1,00 $80 $60 $40 $20 Deposit Growth Trend 9.5 8.5 8.1 8.3 7.6 7.3 6.6 4.9 5.4 3.4 $952.6 $999.5 $1,072.7 $1,159.7 $1,222.3 1 9.0 8.0 7.0 6.0 5.0 4.0 3.0 2.0 1.0 Total Deposits ($) 6-Month YTD % Growth (Annualized) 12-Month YOY % Growth Source: CUDATA.COM 2 nd Quarter 2018 Page 15
Core Deposits (Year-To-Date) % Growth Jun-18 Jun-17-0.2% 0.3% 1.1% 3.2% 3.6% 2.6% 4.1% 4.8% 5.9% 6.4% 6.5% 7.8% 8.6% 11.9% All Other Shares IRA/KEOGH Money Market Certificates Regular Checking All Deposits -2.0% % 2.0% 4.0% 6.0% 8.0% 1% 12.0% 14.0% Deposit Portfolio Composition As of June 30,2018 18.16% 21.70% 0.92% 6.40% 14.91% 37.02% Checking Regular Certificates Money Market IRA/KEOGH All Other Shares Source: CUDATA.COM 2 nd Quarter 2018 Page 16
In Billions Total Investments Growth Trend $45 $40 $35 $30 $25 $20 $15 $10 $5 $ 6.9 5.3 5.7 3.2 1.7 2.6 0.4-3.9-3.2-4.0 $378.9 $366.7 $368.0 $374.4 $359.6 8.0 6.0 4.0 2.0-2.0-4.0-6.0 Total Investments 6-Month YTD % Growth (Annualized) 12-Month YOY % Growth Net Interest Spread Trend 4.82 4.66 4.58 4.51 4.61 3.53 3.53 3.58 3.65 2.91 2.93 2.97 3.02 3.89 3.16 1.92 1.22 1.23 1.34 1.54 0.62 0.60 0.61 0.63 0.73 Yield On Avg Loans (Annualized) Yield On Earning Assets (Annualized) Yield On Avg Investments (Annualized) Cost of Funds (Annualized) Net Interest Spread (Annualized) Source: CUDATA.COM 2 nd Quarter 2018 Page 17
Net Interest Margin vs Operating Expense Ratio Net Interest Income To Avg. Assets Operating Expense To Avg. Assets 3.1 3.1 3.1 3.1 3.1 2.8 2.8 2.9 2.9 120% Total Revenue Breakdown As a % of Total Income 100% 80% 60% 28.1 29.0 28.5 27.7 27.6 8.9 8.1 8.2 8.8 9.5 40% 20% 63.0 62.9 63.3 63.5 63.0 0% Loan Income Investments Income Fee and Other Operating Income Source: CUDATA.COM 2 nd Quarter 2018 Page 18
Dollars ($) 8 Efficiency Ratio % Trend (the cost incurred by a CU to generate one dollar of revenue) 7 6 5 4 3 74.3 73.9 73.1 71.8 69.3 2 1 $16,000 $14,000 $13,052 Average Loan Balance/Member $14,622 $13,947 $13,461 $15,230 $12,000 $10,000 $8,000 $6,000 $4,000 $2,000 Source: CUDATA.COM 2 nd Quarter 2018 Page 19
In Millions Dollars ($) Average Savings Balance/Member $12,000 $11,000 $10,000 $9,000 $8,000 $7,000 $6,000 $5,000 $4,000 $3,000 $2,000 $1,000 $9,599 $9,768 $10,106 $10,482 $10,594 $6.00 Asset / FTE (In Millions) $5.00 $4.34 $4.44 $4.58 $4.75 $4.84 $4.00 $3.00 $2.00 $1.00 $0 Source: CUDATA.COM 2 nd Quarter 2018 Page 20
Number $80,000 $70,000 $60,000 $50,000 $40,000 $30,000 $20,000 $10,000 Salaries & Benefits/ FTE (Annualized) $73,309 $70,939 $68,452 $65,828 $75,764 450 400 Members / FTE 386 384 383 385 386 350 300 250 200 150 100 50 0 Source: CUDATA.COM 2 nd Quarter 2018 Page 21
Annual Operating Expense / FTE $160,000 $140,000 $130,759 $135,070 $138,822 $142,243 $147,538 $120,000 $100,000 $80,000 $60,000 $40,000 $20,000 6 Checking Account Penetration Rate (%) 54.7 55.5 53.4 52.2 52.6 5 4 3 2 1 Source: CUDATA.COM 2 nd Quarter 2018 Page 22
7 Loan Penetration Rate (%) 6 52.7 54.7 56.3 57.1 57.7 5 4 3 2 1 17.6 17.4 17.2 Credit Card Loan Penetration Rate (%) 17.2 17.3 17.3 17.0 16.8 16.6 16.7 16.4 16.2 16.2 16.0 15.8 15.6 15.4 Source: CUDATA.COM 2 nd Quarter 2018 Page 23