Boston, MA, January 14, 2009 – A new report from Aite Group, LLC analyzes the new challenges and opportunities U.S. credit unions are faced with as a result of the financial crisis. It also highlights their growing dependence on technology, with particular focus on the Internet channel, lending systems, security and core systems in the coming year. The report, which is based on the results of a combination of phone and online surveys completed by Aite Group with a panel of 50 U.S. credit unions, recommends new strategies that credit unions should adopt in coming months in order to fully reap the benefits of the current environment.
While it is difficult for any financial institution to escape this financial crisis unscathed, credit unions are better positioned to prosper than many traditional banks. In fact, most credit unions remain positive, and some see the current environment as the best opportunity for growth and industry consolidation in 30 years. Many bank competitors currently pose less of a threat than they once did, because the crisis has forced them to redirect their focus to increasing stability and regaining public trust. Meanwhile, many credit unions are seeing increases in deposits and loan originations, and have an opportunity to attract new members and grow their market share. The full benefits will not be realized, however, unless credit unions take immediate action to reap rewards.
"Most credit unions are well positioned to take advantage of the opportunities presented to them from the current financial crisis," says Christine Barry, research director with Aite Group and author of this report. "They should aggressively seek to expand market share, deploy smart technologies, and penetrate new business segments, such as the small-business segment. They must act quickly, however - once the economy turns around, large banking institutions that have been stagnant for the last few months will hit the ground running."
This 24-page Impact Note contains 13 figures. Clients of Aite Group's Wholesale Banking and Retail Banking services can download the report.