Mid-Market Credit Unions

Member engagement showed mixed signals in Q4 2025. Member growth remained stable quarter-over-quarter at 2.16% versus 2.21% in Q3, but decelerated significantly year-over-year from 2.92%, representing a 75 basis point decline. Despite this deceleration, Mid-Market credit unions maintained a substantial 286 basis point advantage over the national average of -0.69%. This pattern warrants attention as it mirrors early competitive pressure signals seen in smaller tiers five years ago.

Profitability metrics demonstrated the sector's strong recovery from the margin squeeze era. ROA remained stable quarter-over-quarter at 0.71% versus 0.73% in Q3, while showing substantial year-over-year improvement from 0.58%. NIM similarly held steady quarter-over-quarter at 3.25% but expanded 27 basis points year-over-year from 2.98%. Despite this strong performance, Mid-Market institutions trail national benchmarks by 2 basis points on ROA and 48 basis points on NIM, suggesting room for operational efficiency gains.

Growth momentum accelerated across all major categories in Q4 2025. Asset growth accelerated to 5.82% from 4.46% quarter-over-quarter and from 3.36% year-over-year, significantly outpacing the national benchmark of 3.11%. Loan growth accelerated to 5.58% from 5.03% quarter-over-quarter, while deposit growth accelerated to 5.76% from 5.27%. Both loan and deposit growth substantially exceeded national averages by over 300 basis points, demonstrating Mid-Market institutions' competitive positioning in their local markets.

Risk metrics showed modest deterioration quarter-over-quarter but remained well-controlled. Delinquency rates increased to 0.83% from 0.76% in Q3, representing a 7 basis point uptick, while remaining stable year-over-year from 0.79%. Net worth ratios held steady at 11.10% both quarter-over-quarter and year-over-year. Despite the slight delinquency increase, Mid-Market institutions maintain a 7 basis point advantage over the national delinquency rate of 0.90%, though net worth trails national levels by 258 basis points.

Portfolio composition reflects Mid-Market institutions' strategic focus on real estate lending. First mortgage concentration remained stable at 34.08% year-over-year, significantly above the national average of 21.97%. Certificate concentration increased slightly to 29.03% from 28.78% year-over-year, exceeding national levels by over 900 basis points. Indirect auto lending decreased to 18.23% from 19.01% year-over-year, though still maintaining substantial exposure above the national 7.78%. This concentration in rate-sensitive products presents both opportunity and risk.