Credit Unions On a Roll - Hit Record Numbers of Members in 2011

Motivated by higher fees and lower rates at bigger banks, consumers voted with their feet and embraced credit unions. Credit Unions added 1.3 million new customers in 2011, bringing total membership to 91.8 million. That's a record number of credit union members.

"Credit unions ended 2011 in a safer and stronger position than at the start of the year. During the fourth quarter and for the entire year, credit union savings and lending grew at healthy rates. Credit union membership also reached an historic high of 91.8 million on Dec. 31," said NCUA Board Chairman Debbie Matz. "Demonstrating the industry’s resilience, 2011 saw annual net income jump 41.2 percent to $6.4 billion. As a result, net worth grew 6.9 percent, reaching $98.4 billion, and the net worth ratio climbed from 10.06 percent to 10.23 percent."

Credit unions are on a roll. In all, membership increased 398,000 in the last quarter and 1.3 million for the year. Membership growth in the fourth quarter of 2011 stands in contrast to losses of 251,000 in the last quarter of 2010 and 218,000 in the final quarter of 2009. Credit union total assets also continued to rise, reaching $961.8 billion on Dec. 31, an increase of $10.6 billion for the quarter and $47.4 billion for the year.

Consumers are also parking more money at credit unions. Total savings at credit unions reached $827.4 billion, an increase of $8.2 billion in the fourth quarter and $41 billion for the year. In the fourth quarter, money market funds expanded by $4 billion, regular shares rose by $3.6 billion, share drafts increased $1.4 billion, and retirement accounts grew $138 million. Interestinly, the money in share CDs fell by $609 million. Credit unions customers seem to be shifting money to savings and money markets and moving away from certificates of deposit.

BestCashCow data shows that credit union savings and CD rates are significantly higher than their bank peers, offering up to 0.30 percentage points more in yield. They also offer competitive lending rates.

Understand the differences between banks and credit unions.

Unlike banks, not everyone can join every credit union. Credit unions often have restricted membership criteria revolving around area of residence, place of work or worship, organization, and more. If you're thinking about joining a credit union, BestCashCow can help you find local credit unions in your area.