Community Credit Unions

Member growth at Community credit unions remained positive in Q2 2026 at 0.64%, extending a streak that has now run nine consecutive quarters since 2024-Q2. The rate decelerated modestly from 0.70% in Q1 2026 (QoQ), though it is effectively stable versus the 0.65% recorded in Q2 2025 (YoY). Critically, Community CUs continue to stand 1.34 percentage points above the national benchmark of -0.69%, which is contracting. Within the cohort, 59.5% of Community CUs are growing members while 40.1% are declining, revealing meaningful divergence behind the positive headline average.

Profitability improved decisively in Q2 2026. ROA increased to 0.82% from 0.70% in Q1 2026 (QoQ, +0.12 pp) and is up sharply from 0.61% in Q2 2025 (YoY, +0.21 pp), narrowing the gap to the national benchmark of 0.89% to just 7 basis points. NIM also increased, rising to 3.52% from 3.46% in Q1 2026 (+6 bps QoQ) and from 3.34% in Q2 2025 (+0.18 pp YoY), though it remains 22 bps below the national average of 3.74%. Notably, 100% of Community CUs in the cohort are currently profitable, with individual ROA ranging from 0.0% to 3.56%.

Growth dynamics strengthened across the board in Q2 2026. Loan growth accelerated to 4.94% from 4.59% in Q1 2026 (QoQ, +0.35 pp) and from 3.73% in Q2 2025 (YoY, +1.21 pp), marking five consecutive positive quarters and running 4.72 percentage points above the national rate of 0.22%. Asset growth decelerated slightly to 4.63% from 4.80% in Q1 2026 (QoQ), but accelerated meaningfully from 3.88% in Q2 2025 (YoY, +0.75 pp), extending nine consecutive quarters of positive expansion and outpacing the national rate of 2.63% by 2.01 pp. Internally, 87.2% of Community CUs are growing assets and 76.6% are growing loans.

The risk profile showed a mixed picture in Q2 2026. Delinquency increased to 0.77% from 0.68% in Q1 2026 (+9 bps QoQ), though it is essentially stable versus 0.76% in Q2 2025 (+1 bp YoY); the cohort remains 11 bps below the national benchmark of 0.88%. Individual delinquency rates range from 0.03% to 3.66%, signaling meaningful dispersion. Charge-offs were stable at 0.48% versus 0.50% in Q1 2026 (-2 bps), though they run 10 bps above the national rate of 0.38%. Net worth strengthened to 11.09% from 10.93% in Q1 2026 and 10.89% in Q2 2025, though it remains 2.72 pp below the national benchmark of 13.81%.

Community CUs carry a heavily mortgage-weighted loan book, with first mortgages at 34.51% of the portfolio in Q2 2026—up 1.09 pp year-over-year from 33.42% in Q2 2025 and up 0.29 pp from 34.22% in Q1 2026 (QoQ). This concentration is 12.29 pp above the national average of 22.22%, reflecting a deliberate long-duration positioning. Indirect auto lending declined to 15.56%, down 1.23 pp year-over-year, though it still exceeds the national rate of 7.71% by a wide margin. Share certificate concentration edged up to 27.08% from 26.82% in Q2 2025 (+0.26 pp YoY), surpassing the national average of 20.02% and signaling continued member preference for term deposits.