Neighbors Federal Credit Union has more than doubled its assets since 2004 and recently acquired a building adjacent to its Perkins Road headquarters for $1.6 million to continue its expansion in the Capital Region.
As the second-largest credit union in the state, Neighbors now has $760 million in assets and 75,000 members. And it isn’t alone in its growth. Last year alone, Essential Federal Credit Union saw an 8% membership increase when it rebranded itself from Dow Federal Credit Union. It now has some 27,000 members with $310 million in assets.
As Business Report details in a feature from the current issue, more than 1.2 million Louisiana residents are members of credit unions, according to the Louisiana Credit Union League.
Credit unions across the state have seen a 56% increase in membership since 1991, and last year—for the first time ever—they surpassed $10 billion in total assets. That’s triple the amount of assets credit unions held 25 years ago.
“If you look at trends over the last 24 years, credit unions are growing,” says Lacey Hyer Weaver, LCUL vice president of communications. “They’re getting bigger.”
Of the state’s 199 credit unions, Baton Rouge is home to 22, making it the largest market in Louisiana. The expansion of credit unions locally mirrors a national trend. Credit union savings balances across the U.S. rose about $1 trillion for the first time last March, according to industry organization CUNA Mutual Group.
For many consumers, credit unions are attractive because they offer an alternative to traditional banks and tout several benefits, such as fewer fees, better rates, quality services and no minimum deposit accounts. Because they are not-for-profit, credit unions are able to return their earnings to members in the form of lower loan rates, higher interest rates on deposits and other benefits. And unlike banks, credit unions do not pay corporate income taxes because their earnings are returned to members, not shareholders.
Still, credit unions have remained well-kept secrets over the years, Weaver says. That’s because some are exclusive to employees or members of certain industries or professions. But if credit unions have a community charter, anyone who lives, works, worships or attends school in their community can be a member.
“Awareness is the biggest thing,” Weaver says. “I think the gap is slowly closing.”
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