Puerto Rico’s credit unions report increase of $84M in deposits
Puerto Rico’s credit unions reported an increase of $84 million in their deposits to reach $8.1 billion in the second quarter, when compared to the same quarter a year ago, according to the Financial Stability Index of the Credit Union Industry in Puerto Rico.
The sector also reported a total of 1.1 million credit union members, according to the study prepared by Estudios Técnicos Inc. (ETI).
“The industry continues to perform well financially with increases in its deposits, growth in borrowing activity, a stability in the quality of its assets and an expansion in its partner base,” said Leslie Adames, director of ETI’s Economic Analysis and Policy Division.
The Index sustained a value of 0.76 in the second quarter of 2022, an increase from 0.65 for the same date last year and from the value of 0.55 at the end of 2020.
The index fluctuates between 0 (financial fragility) and 1 (financial strength).
It measures the financial health of the credit union industry against four criteria: liquidity (total loans/deposits), solvency (capital to total assets), asset quality (non-performing loans/total loans), and profitability (return on assets).
“Apart from the favorable financial performance experienced so far, positive news is that credit unions have also received funding from the U.S. Treasury Department, giving them greater flexibility to design new products for consumers and small businesses with limited access to products offered by other financial institutions, invest in their technological transformation and continue to contribute to the economic development of the communities to which they serve,” said Adames.
In 2021, more than 20 credit unions received $47 million from the US Department of Treasury’s Community Development Financial Institutions Fund and this year 45 credit unions received an additional $6.9 million.
The loan portfolio of Puerto Rican credit unions increased by $524 million during the second quarter of 2022, for a total balance of $5.9 billion in loans to members, the study showed.
As for the number of members, the customer base had a net increase of 18,428 members to reach a total of 1.1 million in the second quarter of 2022, Adames said.
These data are included in the Credit Union Visualizer that ETI has made available free to credit unions and users interested in the industry. The visualizer monitors the economic context in which Puerto Rico’s credit unions operate.
This includes an interactive map with economic indicators of all the savings and credit cooperatives on the island, as well as data and financial graphs useful for the industry, including the Financial Stability Index for Credit Unions.