Credit Unions in Northern Ireland show strong Year End Results (NI)

Media Release: 09 December 2016

  • Credit union loans are up over 3% year on year. Lending has now been on the rise for four consecutive years.
  • 72% of credit unions (or 67 out of 93 credit unions) recorded growth in their loan books in 2016.
  • Assets increased by 6% and now stand at over £1.3 billion. Assets have been on the rise for six consecutive years.
  • Total credit union membership is now 477,000. Membership increased by 4% in 2016.

The Irish League of Credit Unions (ILCU) has released very positive 2016 year-end figures showing that demand for loans across credit unions in Northern Ireland is increasing steadily. Loans are up by over 3%, with 72% of credit unions growing their loan books in 2016. Lending has now been on the rise for four consecutive years, and has grown by 11% in total since late 2012. Total net loan arrears have fallen by 6% year on year, and are down by £1.2 million. Arrears have now been falling for the past three years.

Assets grew by a significant 6% and now stand at over £1.3 billion - up £78 million year on year. Assets have now been increasing for six consecutive years. ILCU credit unions are significantly bigger than UK or other non-ILCU credit unions in Northern Ireland. The average asset size of ILCU credit unions in Northern Ireland is now £15 million, while the average is £3 million for UK credit unions and £2 million for non-ILCU credit unions. Savings were also up – there was an increase of 7% to over £1.1 billion.

The 2016 results once again show that the credit union movement is extremely well capitalised. Capital reserves increased by £11 million (6%) and now stand at £184 million.

Furthermore, it is expected that credit unions will pay out a dividend broadly in line with the 2015 average of 1%. In recent years, many credit unions have paid a loan interest rebate instead of a high dividend in order to reward borrowers as well as savers. The average loan interest rebate paid in 2015 was 18.58% and early indications from 2016 year end accounts show that the trend is for credit unions to pay higher loan interest rebates than in previous years.

Commenting on the year end results, ILCU President Brian McCrory said “These figures are hugely encouraging, especially with the healthy upward trend in lending. Credit unions have been very proactive in growing lending over the past year and this has been demonstrated by the fact that the vast majority are now reporting lending increases. The figures are reflective of a movement that continues to grow and strengthen, while confidence continues to be expressed by the steady rise in membership, which has now reached 477,000.

With the modernisation of credit union legislation finalised earlier this year, credit unions in Northern Ireland head into 2017 from a very positive position, and the opportunity to offer their services to local businesses and community organisations stands to further bolster the growth of the movement across the province. Credit unions will continue to succeed because we continue to change to meet members’ needs.”

Notes to the Editor

Loans

In total, loans were up by 3.4% in 2016 with 72% of ILCU credit unions in Northern Ireland recording growth in their loan books in 2016. The 3.4% increase compares to an increase of 2% in 2015 and 0.8% in 2014. Lending has now been on the rise for four consecutive years.

Savings and Assets

Assets have grown by 6%, or £78 million, and are now at £1.36 billion. The average asset size of credit unions is now £15 million. Assets have been increasing now for six consecutive years.

Membership

Membership increased by 18,000, or 4% in 2016. Total membership of ILCU credit unions in Northern Ireland is now at 477,000. Since 2010, membership has grown by approx. 75,000.

Arrears

Arrears are down by £1.2 million or 6% year on year. Total net arrears were 3.5% of total loans in September 2016. Arrears have been falling for the past three years.

Provisioning

£28 million provisions are in place as of September 2016.  Generally, provisions are well above Prudential Regulation Authority (PRA) required levels.

-ENDS-

 

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