Data through September 30, 2025 . All figures reflect the universe of 4,419 federally insured credit unions reporting for the quarter. Income-based ratios (ROAA, NIM, NCO ratio) are annualized from year-to-date figures. Growth rates are quarter-over-quarter.
Where the industry stands as of 9/30/2025:The credit union system expanded modestly in 3Q25, with assets crossing $2.42 trillion on the back of steady loan growth and a recovering deposit base. Capital remains well above Prompt Corrective Action (PCA) thresholds system-wide. But the credit quality picture continues to deteriorate — the 60+ day delinquency ratio is pressing toward 1.00%, the largest institutions are carrying disproportionate stress, and annualized charge-offs are running near 76 basis points (bps). Earnings are holding, for now, on the strength of a net interest margin (NIM) that has stabilized in the low 3.30s, but provision expense continues to absorb a growing share of pre-provision income.
325 basis points above the 7.00% well-capitalized threshold
Stable, but watch the tails:The system-wide net worth ratio held at 10.25%, comfortably above the 7.00% well-capitalized threshold. Smaller credit unions continue to carry the thickest capital buffers — institutions under $100M average 13.8% — while the over-$10B cohort runs the leanest at 9.4%. The spread between top and bottom tiers is nearly 450 basis points, a structural feature of asset-size scaling that persists across cycles.
The deterioration continues:The 60+ day delinquency ratio reached 0.94% in Q3 2025, up from 0.88% the prior quarter. The over-$10B cohort is carrying a 1.36% ratio — nearly double the $1B–$10B tier. Annualized net charge-offs are running at 76 bps system-wide, with the over-$10B tier the outlier at 128 bps.
The concentration of stress at the top of the asset distribution is worth watching: the over-$10B cohort holds 35% of system loans but accounts for a disproportionate share of delinquent balances. The elevated charge-off rate in this tier is consistent with their heavier consumer and indirect auto exposure.
Flat for three consecutive quarters after 2023–24 compression
NIM has stabilized, but provision pressure is real:Annualized net interest margin held at 3.33%, roughly flat from the prior two quarters after compressing through 2023–2024 as funding costs caught up with asset yields. ROAA came in at 80 bps annualized, but provision for credit losses is absorbing a growing share of pre-provision income.
The repricing lag appears to have largely run its course, at least in aggregate. The smallest credit unions (under $100M) are posting ROAA in line with the system despite their higher capital ratios, while the $500M–$1B tier is the relative underperformer at 68 bps.
Lending is accelerating, led by the largest institutions:System loans grew 1.57% quarter-over-quarter, the strongest single-quarter expansion in the 12-quarter window. The $1B–$10B cohort led at 1.75% QoQ. Credit unions under $100M posted essentially flat balances (+0.45%).
The system-wide loans-to-assets ratio ticked up to 70.97%, continuing a gradual rise that reflects both loan origination momentum and the relative drag on investment portfolio returns that keeps credit unions reaching for yield on the loan book. The flat growth at smaller institutions is consistent with the secular consolidation trend in which they are losing market share in lending.
Gradual rise as loan growth outpaces deposit inflows
Funding is following the loans:Shares and deposits grew 0.85% QoQ to $2.05 trillion, modestly trailing loan growth and continuing to push the loans-to-assets ratio upward. Borrowings total $88.3 billion — material but not alarming relative to system size.
The loans-to-assets ratio varies meaningfully by tier: the largest credit unions run at 73%, while those under $100M sit at 53%. This reflects both the lending capacity that comes with scale and the operational reality that smaller credit unions carry proportionally more of their balance sheet in investments and cash.
Key CAMELS-aligned metrics by asset-size cohort for the quarter ending September 30, 2025. Income-based ratios annualized from 9-month YTD figures. Growth rates are single-quarter (QoQ).
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Standardized Data Table — CAMELS Metrics by Asset-Size Cohort, Q3 2025
This table is optimized for interactive viewing and is not included in the PDF. View the full data at finasense.com or in the accompanying spreadsheet.
Pressure: Delinquency at the top of the distribution — The over-$10B cohort's 1.36% delinquency ratio is now 58 bps above the system average and widening. This tier's outsized consumer lending exposure — particularly indirect auto and credit card — is the likely driver.
Watch: Loan growth reaccelerating — The 1.57% QoQ loan expansion is the strongest in the 12-quarter dataset. If this pace holds through Q4, full-year loan growth will exceed 2024 levels despite the tightening credit environment.
Favorable: NIM compression has paused — After six quarters of declining margins driven by deposit repricing, NIM has flatlined in the low 3.30s. Whether this is a floor or a pause depends on the path of short-term rates and the degree to which credit unions have completed their CD and money market repricing.
Favorable: Small CU capital buffers — Credit unions under $100M carry a 13.8% net worth ratio — nearly 700 bps of cushion above the PCA well-capitalized threshold. These institutions have room to absorb credit losses that would stress thinner-capitalized peers.
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FINASENSE is not affiliated with the National Credit Union Administration (NCUA). Financial data is sourced from NCUA 5300 Call Report filings as submitted by individual credit unions and is not guaranteed as to accuracy or completeness. Ratio definitions and account classifications reference the NCUA Financial Performance Report (FPR) Chart of Accounts. All aggregation, analysis, and derived metrics are independently computed by FINASENSE and may differ from NCUA-published figures. Interpretations reflect the views of FINASENSE and not those of the NCUA.
This report does not consider the specific circumstances of any individual credit union and is not tailored advice. FINASENSE has no financial relationship with, and receives no compensation from, any institution referenced.
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