CHICAGO — A new survey from TransUnion showed approximately
two in three credit union executives see loan growth as the critical business
issue facing their industry in 2013, and auto loans may be the main focus of
that growth.

The survey found that more than half of credit union
respondents believe auto loans are their biggest opportunity.

TransUnion administered the survey to 104 credit union
executives at the CUNA Governmental Affairs Conference in Washington, D.C., in
late February. The firm indicated nearly all respondents from across the U.S.
were board members, executives or in managerial roles for their credit union.

"Many credit unions are finding that auto loans provide a
great revenue opportunity as delinquencies continue to stay near historic
lows," said David Dodson, credit union vice president in TransUnion's financial
services business unit.

"TransUnion projects auto loan delinquencies to continue to
remain low with balances rising for the remainder of the year – pointing to
more new and used auto sales," Dodson continued.

TransUnion's latest auto loan trend data report noted that
60-day auto loan delinquencies stood at 0.41 percent as of fourth quarter of
2012. Analysts projected delinquencies will likely remain near 0.40 percent by
the end of this year.

The firm's latest information also indicated bank auto debt
per borrower has risen for seven straight quarters, and it is expected to rise from
$13,747 in Q4 2012 to more than $14,000 by the conclusion of this year.

In a sign that the housing market may be improving, the
survey found that some credit union executives believe their best opportunities
for loan growth are with mortgage (18 percent) and small business (13 percent)
loans.

TransUnion data also supports this as 60-day mortgage loan
delinquencies are expected to experience a double-digit percentage drop in
2013.

While the far majority of credit union respondents (68
percent) said loan growth was the biggest critical issue they were facing this
year, 11 percent noted that regulation was their main concern.

Technology/operation efficiencies (7 percent) and membership
growth (6 percent) were also cited as major issues for 2013.

Credit union respondents said their biggest challenges to
meeting loan growth goals are competition from large banks and captives (40
percent), regulation (27 percent) and the lack of prospects (17 percent).

"Loan growth is traditionally the biggest concern for credit
unions, but it is interesting to see regulatory scrutiny and operational
efficiencies called out as critical issues by some credit unions," Dodson said.

"Credit unions realize that to effectively compete and grow
in today's market, technology and analytics must be leveraged to help in
acquisition efforts and to know how to best maximize members' wallets at the
right time in the customer lifecycle," he went on to say.

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