U.S. and Canadian Credit Unions - US - May 2007

Table of Contents

• Scope and Themes
• What you need to know
• Abbreviations and terms
• Abbreviations
• Terms
• Executive Summary
• Canadian credit union statistics, year-end 2006
• U.S. credit union statistics, year-end 2006
• Credit union marketing--examples
• Targeting Hispanics
• Securitization
• Other trends
• Online and word of mouth strategies
• The credit union consumer
• Future trends
• Overview of the Credit Union Sector
• A bit of history
• Credit unions--an inadvertent advantage
• Market trends
• Small business lending
• Small business entrepreneurs
• The credit union difference
• So why should consumers use credit unions?
  • Figure 1: Credit card pricing--credit unions versus banks, 2007
• Demographic Market Drivers
• Canada--age demographics
  • Figure 2: Median age of the Canadian population, 1921-2004
  • Figure 3: Frequency respondents have changed banks in last five years, by age, December 2006
• The shortage of peak borrowers in both Canada and the U.S.
  • Figure 4: U.S. credit union savings versus loans, 2006 and 2007
  • Figure 5: U.S. households shift in financial asset mix, 1984 and 2004
  • Figure 6: Canadian credit unions--income from traditional sources, 1995-2003
• Economic Market Drivers
  • Figure 7: New single-family houses for sale--U.S., 1963-2006
  • Figure 8: Existing single-family home sales--U.S., 1999-2006
  • Figure 9: National Association of Realtors' median sales price, existing single-family homes, 1968-2006
  • Figure 10: Mortgage loan purchase composite index--U.S., 2002-06
• Technological Market Drivers
  • Figure 11: Percent of all respondents who use the Internet, year end 2000--April 2006
• Canada--technological market drivers
  • Figure 12: Canadians' primary methods of banking, 2005
  • Figure 13: Potential steps to increase trust and protect privacy--Canada, 2005
  • Figure 14: Reasons for adult home users to go online, 2005
• The U.S.--the rise of the machine
• Electronic banking/technology
• Technological developments--budgeting
• The ' electronic member' --building relationships
• Are there any financial institutions that have unique or very individual online experiences?
• Market Drivers--Focus on Hispanics
• Targeting Hispanics
  • Figure 15: U.S. Hispanic population and projections, 1950-2050
  • Figure 16: Hispanic buying power, 1989-2004
• Micro-financing and Hispanics
  • Figure 17: ACCION' s partners*, 2006 statistics
  • Figure 18: U. S. Hispanic firms, by paid employee, 2002
• Hispanics and education
• How do we do it?
• An actionable plan for credit unions and the Hispanic market
• Financial product development
• A payday product
• Technology loans
• Remittances
  • Figure 19: Volume of remittances distributed by credit unions in six countries, Q3 2001-Q4 2003
  • Figure 20: Uses of remittances--Central America and Mexico--IDB/MIF Central America survey, 2003
  • Figure 21: Remittance cost considerations for credit unions, 2003
• Regulatory Issues
• Canadian regulatory issues
• Canadian and U.S. regulatory differences
• Regulatory environment--field of membership restrictions
• The progressive part of the country
• The not so progressive parts of the country
• Basel II--capital requirements
  • Figure 22: Capital ratios of banks and credit unions in the U.S., 1980-2005
• Securitization
• Canadian credit union securitization
  • Figure 23: Canadian credit union assets in securitized issuance, January 2007
• U.S. credit union securitization
• Overall Market Size and Growth
• Market size
• Canadian credit unions
  • Figure 24: Canadian credit unions at a glance, 2007
  • Figure 25: The Canadian credit union system--market tiers, 2006
• U.S. credit unions
  • Figure 26: U.S. credit union facts at a glance, 2004
  • Figure 27: U.S. credit union market tiers, 2005
• A decreasing number of credit unions--with a growing membership
  • Figure 28: Number of U.S. credit unions, 1997-2005
  • Figure 29: National credit union membership trend, 2001-06
• Canadian credit unions
  • Figure 30: Number of credit unions in Canada, 1987-2005
  • Figure 31: U.S. credit unions total assets, 2001-06
  • Figure 32: U.S. credit union return on assets, 2001-06
  • Figure 33: Canadian credit unions' return on equity, 2000-03
  • Figure 34: U.S. credit unions' ratio of delinquent loans to total loans, 2001-06
• U.S. credit union loan growth
• Indirect lending
• One example--indirect lending in Ohio
  • Figure 35: U.S. credit unions' total loans (in $ millions), 2001-06
  • Figure 36: U.S. credit union loan growth trends, 2003-06
• Indirect lending--after the growth is gone
  • Figure 37: U.S. credit unions' total value of loans, 2001-06
  • Figure 38: U.S. credit unions' total loan growth rate, 2001-06
• Deposit growth
  • Figure 39: U.S. credit unions' total deposits, by value, 2001-06
  • Figure 40: U.S. credit unions' total deposits, percentage growth, 2001-06
  • Figure 41: Growth in U.S. credit unions' savings and assets, 2001-06
  • Figure 42: Credit union savings growth rate--percent change over previous year, 2005-07
  • Figure 43: U.S. credit unions' total surplus funds, 2005 and 2006
• Canadian credit union growth
  • Figure 44: Canadian credit unions' comparative six-month growth rates, Q2 2004-Q2 2006
• Market Share and Segmentation
• Canadian credit unions--market share rankings
  • Figure 45: Canadian financial institution market share, by assets, 2005
  • Figure 46: Number of credit unions in Canada, 1987-2005
  • Figure 47: Canadian credit union ranking, by quarterly revenue, 2005
  • Figure 48: Canadian market share, by domestic assets, deposits, consumer credit & mortgages, 2006
  • Figure 49: Canadian credit union income from traditional sources, 1995-2003
  • Figure 50: Top ten Canadian credit unions, by asset size, Q4 2005-Q2 2006
• U.S. credit unions
• Loan growth performance by segment
  • Figure 51: Key year-end performance results, 2006
  • Figure 52: Top 20 U.S. credit unions, by loan growth--greater than $500 million, December 2006
  • Figure 53: Top 20 U.S. credit unions, by loan growth--greater than $100 million to $500 million, December 2006
  • Figure 54: Top 20 U.S. credit unions, by loan growth--greater than $50 million to $100 million, December 2006
  • Figure 55: Top 20 U.S. credit unions, by loan growth--greater than $10 million to $50 million, December 2006
  • Figure 56: Top 20 U.S. credit unions, by loan growth--greater than $2 million to $10 million, December 2006
  • Figure 57: Top 20 U.S. credit unions, by loan growth--less than $2 million, December 2006
• U.S. credit union market segmentation by asset size
  • Figure 58: U.S. credit union distribution, by asset size, 2005
  • Figure 59: Top 20 U.S. credit unions, by assets, 2005 (1)
  • Figure 60: Top ten credit unions, by number of members in 2005
  • Figure 61: Top ten credit unions, by number of employees in 2005
• Canadian and U.S. competitive landscape
• Advertising and Promotion
• Responding to customers
• Marketing for growth
• Customer surveys--one viewpoint
• Customer surveys--another viewpoint
• Customer surveys--an example
• Demographic and psychographic marketing
• Marketing strategies--targeting the Hispanic market
• A credit union opportunity
  • Figure 62: Hispanic survey--which language do you use for Internet marketing programs specifically geared to target Hispanics?
• Internet advertising and search engine optimization
  • Figure 63: U.S. online searches, by engine, February and March 2007
• Word-of-mouth marketing
• The U.S. Consumer
• Summary highlights of consumer survey
• Membership
  • Figure 64: Credit union membership and/or eligibility, by gender and age, April 2007
  • Figure 65: Credit union membership and/or eligibility, by income, April 2007
  • Figure 66: Credit union membership and/or eligibility, by race/ethnicity, April 2007
  • Figure 67: Credit union membership and/or eligibility, by employment status, April 2007
• Credit unions as primary provider
  • Figure 68: Credit unions as primary provider, by gender, April 2007
  • Figure 69: Credit unions as primary provider, by age, April 2007
  • Figure 70: Credit unions as primary provider, by income, April 2007
• Products provided by credit unions
  • Figure 71: Financial products owned by credit union clients and/or credit union-eligible clients at a credit union, overall, April 2007
  • Figure 72: Financial products owned by credit union clients and/or credit union-eligible clients at a credit union, by age, April 2007
  • Figure 73: Financial products owned by credit union clients and/or credit union-eligible clients at a credit union, by Hispanic/non-Hispanic, April 2007
  • Figure 74: Financial products owned by credit union clients and/or credit union-eligible clients at a credit union, by region, April 2007
  • Figure 75: Financial products owned by credit union clients and/or credit union-eligible clients, where products are owned, overall, April 2007
  • Figure 76: Advantages of using a credit union for a loan(s) and/or credit card(s), April 2007
  • Figure 77: Advantages of using a credit union for a loan(s) and/or credit card(s), by age, April 2007
  • Figure 78: Advantages of using a credit union for a loan(s) and/or credit card(s), by Hispanic and non-Hispanic, April 2007
  • Figure 79: Advantages of using a credit union for savings/checking/investments, by gender, April 2007
  • Figure 80: Advantages of using a credit union for savings/checking/investments, by Hispanic/non-Hispanic, April 2007
• Are customers feeling valued?
  • Figure 81: Perceptions of retention efforts by financial institutions, April 2007
  • Figure 82: Perceptions of retention efforts by financial institutions, by age, April 2007
  • Figure 83: Perceptions of retention efforts by financial institutions, by income, April 2007
• Joining the credit union "club"
  • Figure 84: Importance of links to community, work, or other groups, by gender, April 2007
  • Figure 85: Importance of links to community, work, or other groups, by Hispanic/non-Hispanic, April 2007
• Future and Forecast
• Future trends
• The future couldn' t be brighter
• Revolutionary change?
• A checklist for revolutionary change
• Market forecast
• Credit union assets
  • Figure 86: Forecast of total U.S. credit union assets, at current and constant prices, 2006-11
  • Figure 87: Forecast of credit union assets, at current and constant prices, 2006-11
• Forecast factors
• Appendix: Trade Associations
• Credit Union Organizations
• State Credit Union leagues
• Canada trade associations
• Appendix: Advertising and Promotion
  • Figure 88: Navy Federal Credit Union mailing, September 2006
  • Figure 89: CUNA Mutual Insurance Company/Hartford Federal Credit Union mailing, April 2007
  • Figure 90: AM Federal Credit Union/Liberty Mutual auto insurance mailing, April 2007
  • Figure 91: SCE Credit Union Premier Money Market Account mailing, October 2006