November 19, 2025— In his recap of the Callahan & Associates Trendwatch 3Q25, CreditUnions.com author Tony Waltrich notes that despite an uneven economy marked by cooling job growth, persistent inflation, and widening financial strain for many households, credit unions are quietly gaining strength by doing what they do best: supporting members through stability and service. Altogether, the quarter’s trends paint a clear picture: as economic outcomes diverge sharply, resulting in some individuals improving their financial well-being as others struggle to maintain financial stability, credit unions are attracting new members, deepening loyalty, and maintaining the credit union’s financial health—all while helping their members and their communities navigate increasingly uncertain times.
Membership growth picked back up in the third quarter, signaling renewed consumer trust. As Waltrich notes, this “is the surest sign that credit unions are providing value to Americans. It shows the industry is offering in-demand products and services when for-profit institutions might be pulling back to reduce risk.” Lower interest rates also reignited lending—especially in mortgages—helping members access more affordable credit while deepening their relationships with their cooperatives.
At the same time, signs of financial stress are emerging. Delinquency rates are inching up across most loan types as inflation and tariffs weigh on household budgets. Yet members are largely holding steady, and credit unions continue to guide borrowers through challenges, keeping charge-offs low.
Financially, this quarter, credit unions are operating from a position of strength. Net interest margins widened meaningfully, outpacing the rise in operating expenses and bolstering earnings in a way the industry hasn’t seen in decades. The Trendwatch data also shows that credit union net interest margin climbed to 3.38% this quarter, rising faster than operating expenses and providing a significant boost to earnings. Strong lending demand—driven by credit unions moving more shares into higher-yield mortgages—paired with a steady 2.06% cost of funds helped support this margin growth. Operating expenses increased modestly to 3.11%, reflecting inflation-related pressures, yet overall ROA remains healthy at 0.81%. Notably, margins have not outpaced operating costs by such a wide gap in decades, giving credit unions crucial flexibility to support members as they navigate rougher terrain ahead, while ensuring their own long-term stability.
More key takeaways from the latest Trendwatch report, along with comprehensive data supporting these trends, is updated quarterly and available on CreditUnions.com.