Tennessee Credit Unions

Member engagement deteriorated meaningfully in 2026-Q1. Member growth decelerated to negative 0.92% from negative 0.69% in 2025-Q4 — a 0.23 pp quarter-over-quarter decline — and collapsed from positive 2.69% in 2025-Q1, a 3.61 pp year-over-year swing. At negative 0.92%, TN credit unions now trail the national member growth rate of negative 0.65% by 28 basis points. The accelerating membership contraction, combined with negative loan growth, suggests weakening product uptake and raises questions about whether TN institutions are retaining existing members or attracting new ones.

Profitability is a genuine bright spot for TN credit unions. ROA was stable quarter-over-quarter at 0.74%, up just 0.03 pp from 0.71% in 2025-Q4, but the year-over-year story is more compelling — ROA increased 6 bps from 0.68% in 2025-Q1, placing the cohort 7 bps above the national benchmark of 0.67%. NIM was equally stable at 3.83%, essentially flat from 3.84% in 2025-Q4, while rising 7 bps from 3.76% in 2025-Q1 and sitting 13 bps above the national average of 3.70%. Margin discipline is holding despite loan contraction.

Growth decelerated on both key dimensions in 2026-Q1. Asset growth slowed to 1.87%, decelerating 0.71 pp from 2.58% in 2025-Q4 and a sharp 5.28 pp deceleration from 7.15% in 2025-Q1 — now 77 bps below the national benchmark of 2.64%. Loan growth contracted further to negative 1.19%, decelerating 0.43 pp from negative 0.76% in 2025-Q4, and now trails the national rate of 0.31% by 150 bps. The combination of shrinking loan books and slowing asset accumulation points to constrained balance sheet expansion heading into mid-2026.

The risk profile for TN credit unions is mixed but broadly constructive. Delinquency decreased 0.19 pp quarter-over-quarter to 0.66% in 2026-Q1 from 0.85% in 2025-Q4 — a meaningful improvement — though it has increased 0.08 pp year-over-year from 0.58% in 2025-Q1. At 0.66%, the cohort remains 12 bps below the national benchmark of 0.78%, a favorable position. Net worth decreased modestly by 0.09 pp from 15.12% in 2025-Q4 to 15.03% in 2026-Q1, yet is up 0.44 pp year-over-year from 14.59%, and stands a substantial 1.42 pp above the national average of 13.61%.

Portfolio composition shifted modestly in 2026-Q1. First mortgage concentration rose to 21.42%, up 0.20 pp from 21.22% in 2025-Q4 and up 0.70 pp from 20.72% in 2025-Q1, though still 0.73 pp below the national benchmark of 22.15%. Indirect auto edged up 0.14 pp quarter-over-quarter to 6.83% from 6.70% in 2025-Q4, but is down 0.15 pp year-over-year from 6.98%, trailing the national rate of 7.73%. Certificate concentration was stable at 22.30%, nearly unchanged from 22.35% in 2025-Q4, yet up 0.72 pp from 21.58% in 2025-Q1 — and notably 2.50 pp above the national average of 19.80%.