Customer satisfaction with credit unions broke all prior records this year, according to a report released by University of Michigan researchers who publish the American Customer Satisfaction Index (ACSI).
The credit union industry”™s ACSI score soared 9 percent to reach the highest level ever by any of the nearly 50 industries represented on the index ”“ while tripling its lead over banks.
On oft-overlooked component of the financial services industry due to the small amount of commercial loans they issue, credit unions have gained stature in the past year as big banks continue to suffer a backlash from measures undertaken as the Dodd-Frank financial reform act has come into play.
Despite a slight decline in the number of federally insured credit unions, institutions added more than 450,000 members during the third quarter according to the National Credit Union Administration (NCUA), pushing the national total to 91.4 million people.
Congress is considering multiple bills that could ease some restrictions on credit unions, including one that would more than double an existing member business lending cap for those institutions with sufficient capital ratios.
More than 35 credit unions are based in Fairfield County of some 130 statewide, according to the Connecticut Department of Banking ”“ those range from small church organizations to Sikorsky Credit Union, Fairfield County”™s largest with more than 54,000 members and $300 million in loans outstanding as of September. Statewide, only the Connecticut State Employees credit union is larger with more than 70,000 members at last report and it has $75 million less in loans outstanding.
In fact, just five banks based in Fairfield County have a larger deposit base than Stratford-based Sikorsky Credit Union. As it looks to expand its base, the credit union has opened branches at high schools in Oxford and Seymour the past few years, servicing both staff and students.
Financial institutions of all types are feeling their way through increased federal and state regulatory oversight. Since the advent of the Great Recession in 2008, two credit unions in Farmington and Hartford have failed, totaling a scant $4.3 million in total assets.
“Banks are facing difficult times on multiple fronts: profits are being squeezed, regulators are more demanding, foreclosures remain problematic and consumers are fighting back on fees,” said Claes Fornell, creator of ACSI. “On top of all this, many banks are losing customers, including defections prompted by grassroots efforts like the recent Bank Transfer Day.”
Fornell referred to the day in November activists urged bank customers to switch their accounts to smaller community banks and credit unions. Estimates have varied on how many bank customers did so, but experts agree that credit unions appeared to have made significant gains that day.
