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WASHINGTON – The National Association of Federally-Insured Credit Unions (NAFCU) today released its 2020 NAFCU Report on Credit Unions. The report shows, among other things, the critical and growing role credit unions play in our local communities, including their efforts in helping Americans overcome the coronavirus pandemic.

“The coronavirus pandemic posed many challenges for our nation,” said NAFCU President and CEO Dan Berger. “The 2020 NAFCU Report on Credit Unions shows how credit unions proactively and successfully adjusted their daily operations to help Americans nationwide, including many low- and moderate-income communities.

“As credit unions continue to help our economy recover and families make ends meet amid the pandemic, regulatory and compliance burdens still weigh heavily on their ability to serve members. The report details the importance for policymakers to ease regulatory burdens on credit unions as they continue to put the financial well-being of their members well ahead of their own profits.”

The report on credit unions looks at four key areas: credit union trends, credit unions' service offerings, policy priorities for credit unions, and the industry’s strong response to the coronavirus pandemic.

Some of the key findings in the 2020 report include the following:

Industry Trends

• The vast majority of credit unions are small institutions with limited resources. The median credit union manages only $40 million in assets and has just 10 employees.
• Credit unions are 10 times more likely than banks to have a female CEO. Among minority depository institutions, there are over three times as many credit unions as banks. Credit unions serve more low- and moderate-income households than banks do, with better pricing and lower fees.
• Standing on the cusp of another extended period of low interest rates, it is critical that regulators reduce compliance burdens on credit unions.

Credit Union Product & Service Offerings

• Data from the Federal Reserve and from the Home Mortgage Disclosure Act show that credit unions are serving a high proportion of minority communities and low- and moderate-income households.
• Mortgage data indicate that credit union loans carry lower costs and lower rates than those of other lenders.
• Bank branch networks are eroding at a troubling rate, but the growth of credit union branches, particularly in rural areas, provides an important counterbalance.
• Credit unions offer abundant access to products like free checking, and they are ramping up investments in financial technology.

NAFCU Policy Priorities

• Credit unions provide over $16 billion annually in benefits to the economy and preserving the credit union tax exemption remains NAFCU’s top legislative priority.
• Maintaining access to a healthy and viable secondary mortgage market with fair pricing is critical to ensuring community-based lenders can continue to serve their members.
• The COVID-19 pandemic provides more evidence that credit union capital rules need to be updated to provide a more flexible regime with expanded access to capital.
• Modernized field of membership rules are crucial to the future welfare of the credit union industry. The NCUA won a critical court decision validating its final rule granting certain credit unions a measure of FOM relief, but NAFCU urges the agency to do more.
• NAFCU is encouraged by the NCUA’s pilot program for remote examinations. Further refinements, such as lengthening the exam cycle, would make the examination process less burdensome for credit unions.
• Credit unions continue to labor under the immense cumulative regulatory burden in the post Dodd-Frank era. The number of employees devoted to regulatory compliance has more than doubled since 2010.

Credit Unions Respond to the Pandemic

• Credit unions have been successfully adjusting their operations during COVID-19. Reports from NAFCU members reveal that remote work arrangements have exceeded expectations.
• As life ground to a halt, credit unions worked diligently to meet their members’ needs, adding staff to call centers, extending loan forbearance, and, for many, taking part in the Small Business Administration’s Paycheck Protection Program with little past experience working with the SBA.
• Virtually every financial regulator produced some measure of COVID-related relief to help ease economic and operational shocks within the financial sector.

About the Report:

The information gathered in the 2020 NAFCU Report on Credit Unions is based on the association's Federal Reserve Meeting Survey, an annual assessment of NAFCU members covering topics discussed in the report. The report also draws on data collected for NAFCU's Economic & CU Monitor and CU Industry Trends Report.

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The National Association of Federally-Insured Credit Unions is the only national trade association focusing exclusively on federal issues affecting the nation’s federally-insured credit unions. NAFCU membership is direct and provides credit unions with the best in federal advocacy, education and compliance assistance. For more information on NAFCU, go to www.nafcu.org or @NAFCU on Twitter.