Industry Analysis & Industry Trends
Like the rest of Australia's Finance subdivision, credit unions have been hurt by the global financial crisis and a slowing economy in 2008-09. Their mutual status, prudent lending and heavy reliance on deposits for funding have shielded the industry to some extent, but the past five years have been difficult nonetheless. As the Australian economy transitions from mining to non-mining sectors, the Reserve Bank of Australia has dropped interest rates to historic lows. This decimated the revenue generated from lending portfolios. Even more detrimental was the effect of credit unions leaving the industry and taking portions of revenue and asset base with them. As a result, industry revenue is forecast to decline at an annualised 8.8% over the five years through 2014-15 to reach $2.4... purchase to read more
Industry Report - Industry SWOT Analysis Chapter
The Credit Unions industry is in the declining stage of its life cycle with industry value added forecast to decline at annualised 2.8% over the 10 years through 2019-20. This is expected to be lower than the annualised GDP growth rate of 2.7% over the same period. Characteristic of a declining industry, credit unions have been exiting the industry over the past five years, with industry assets falling and employment declining. There has been little product innovation and the companies in the industry struggle to diversify into new markets. Further organic growth is limited by the structure of credit unions.
The number of credit unions is expected to fall at an annualised 5.4% to 82 over the five years through 2014-15... purchase to read more