ARLINGTON, Va.—Credit union leaders are showing a slight improvement in their outlook on the economy and their organization’s futures.
NAFCU’s Credit Union Sentiment Index (CUSI) showed modest improvement in June, after reaching its lowest point on record and falling into the pessimistic range during the previous month.
The Index based on NAFCU member responses to eight questions on growth and earnings outlook, lending conditions and regulatory burden.
"Those with an optimistic growth outlook cited an improving economic outlook, liquidity conditions, and the paycheck protection program," said NAFCU Chief Economist and Vice President of Research Curt Long. "Those with pessimistic growth outlooks cited the still-depressed economic outlook."
CARES Act Stabilizes Delinquencies
Turning to delinquencies, NAFCU's latest edition of the Economic & CU Monitor suggests fiscal support from the CARES Act may have helped keep delinquency conditions stable in spite of high unemployment rates.
Under the CARES Act, many Americans were eligible for support such as enhanced unemployment insurance and one-time stimulus payments. However, Long noted that much of the support will expire after July 31.
The CARES Act also permitted borrowers experiencing financial hardship during the coronavirus crisis to request forbearance on single-family and multifamily loans sold to the GSEs and, in response, mortgage servicers must provide a forbearance that allows borrowers to defer their mortgage payments up to 180 days with an option for an additional 180-day extension.
Long noted more than 80% of Economic Monitor survey respondents indicated they had voluntarily offered forbearance on other consumer loans.
"Among the most popular options offered were 90-day skip-a-pay arrangements, and longer extensions for any COVID19 related hardship," highlighted Long.
Additionally, respondents reported that they were using a variety of channels to communicate the availability of hardship relief to members, including:
- Website
- Social media
- Phone communications