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San Francisco North Bay credit union lending rises 15% in Q4

North Bay credit unions Q4 snapshot

Comparisons to the fourth quarter of 2019

Membership: 599,600, up 4% and a 47% rise from 407,000 in 2013

Loans: $8.4 billion, up 15%

35% rise in first mortgages, totaling a record $4.2 billion

2% nudge in used-auto loans, totaling $1.6 billion

6% bump in business loans, including for real estate deals, amounting to $564 million

Deposits: $10.2 billion, up 26%

Checking, savings, money market and IRA accounts plus certificates of deposit: up 9% to 48%

Source: California and Nevada Credit Union Leagues

Beyond seeing an uptick in membership of 4%, nine credit unions based in the North Bay experienced a record surge in lending during the last quarter of 2020.

The California and Nevada Credit Union Leagues reported a 15% increase in the value of all those loans to $8.4 billion in the fourth quarter, compared with the same period in 2019.

Lending was buoyed by first mortgages, business loans and those to buy used autos, according to spokesman Matt Wrye. First mortgages, which encompass refinances and first-time buyers, came in with $4.2 billion, a 35% rise in comparison to 2019’s last quarter.

Participating in the industry trade group’s survey were Community First Credit Union, North Bay Credit Union, Travis Credit Union, Befit Financial Federal Credit Union, Marin County Federal Credit Union, Silverado Credit Union, Sonoma Federal Credit Union, Solano First Federal Credit Union and the region’s largest, Redwood Credit Union, which was founded in 1950.

Ron Felder is chief financial and risk officer of Redwood Credit Union. (courtesy photo)
Ron Felder is chief financial and risk officer of Redwood Credit Union. (courtesy photo)

“If you look at 2020, we had a 14% growth in first mortgages,” said Redwood Credit Union Chief Financial and Risk Officer Ron Felder.

In the banking and finance world, the COVID-19-laden year was marked by historically-low interest rates that drove consumers to refinance their homes and get into new houses as well as seize on deals for used vehicles.

“Certainly, in the first month of the pandemic, demand really fell off because the dealerships were closed, but we saw pent-up demand come in,” Felder said.

The credit union reported an 11% year-over-year rise in used auto loans, with lending for new cars nudging up by 1%. It appears consumers, while willing to spend the money they had, were trying to be frugal with their purchases given an uncertain economic climate.

Enter 2021 — demand for consumer loans anchored by predominantly auto loans has not subsided. Redwood Credit Union ends the month with what could amount to be its “largest in history,” Felder said. At first glance, Felder estimated the first quarter would end with a tally of at least $80 million in the first quarter of 2021, or 16.5% higher than the year before.

Redwood Credit Union also demonstrated an active business in processing 2,100 Paycheck Protection Program loans amounting to $120 million. The lending program, which is administered by the U.S. Small Business Administration through the federal stimulus plan, is now on its second round, with the credit union processing those applications along with the forgiveness forms.

At Community First Credit Union, CEO Todd Sheffield, who plans to retire in June, noted his credit union experienced a 14% increase for the entire year in loan growth due primarily from “super low” interest rates.

“It doesn’t seem like the last recession. We had a good fourth quarter for sure,” he said.

North Bay credit unions Q4 snapshot

Comparisons to the fourth quarter of 2019

Membership: 599,600, up 4% and a 47% rise from 407,000 in 2013

Loans: $8.4 billion, up 15%

35% rise in first mortgages, totaling a record $4.2 billion

2% nudge in used-auto loans, totaling $1.6 billion

6% bump in business loans, including for real estate deals, amounting to $564 million

Deposits: $10.2 billion, up 26%

Checking, savings, money market and IRA accounts plus certificates of deposit: up 9% to 48%

Source: California and Nevada Credit Union Leagues

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