Credit unions' Q1 auto delinquencies increase YOY for 1st time in 2 years

U.S. credit unions added $12.86 billion in auto loans during the first quarter of 2022, taking the industry's aggregate auto loan balance to $421.07 billion at the end of March.

Used auto loans took the lion's share, increasing 3.7% sequentially and 13.0% year over year to $274.83 billion at March 31, according to S&P Global Market Intelligence data. New auto loans increased to $146.24 billion, up 2.1% from the end of 2021 and 3.4% from the year-ago quarter.

Used auto loans 30 days or more past due increased 24 basis points year over year to 0.89% of aggregate used auto loans at March 31, the first year-over-year increase since the first quarter of 2020.

Likewise, new auto loans 30-plus day past due increased 15 basis points year over year to 0.87% of total new auto loans, the first year-over-year increase in two years.

Vienna, Va.-based Navy FCU, the largest credit union in the U.S. by assets, reported $20.82 billion in auto loans as of March 31, up 14.0% year over year, and more than three times the amount of Riverdale, Utah-based America First FCU in second place.

Including Navy FCU, 18 of the 20 largest credit unions by auto loans reported a year-over-year increase in total auto loans.

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Tysons, Va.-based Pentagon FCU grew its auto loan book by 46.8% year over year, the largest increase in the group. The auto loan delinquency rate at PenFed rose 83 basis points year over year to 2.3%, the second-highest delinquency rate in the group, due to its new auto loan delinquency nearly doubling to 1.6%.

Raleigh, N.C.-based State Employees CU reported the highest auto loan delinquency rate among the group, a rise of 93 basis points year over year to 2.5%. The credit union's used car loan delinquency rate increased 105 basis points year over year to 2.8% and its new car loan delinquency rate increased 51 basis points to 1.7%.

Anchorage, Alaska-based Alaska USA FCU reported the industry's largest indirect auto loan balance at the end of the first quarter at $4.50 billion, followed by America First FCU at $4.12 billion.

The median interest rate on auto loans increased across every U.S. region quarter over quarter as the U.S. Federal Reserve has begun raising interest rates in earnest. As of May 27, the median interest rate nationwide for a 60-month new car loan was 4.0%, up from 3.8% at the end of March. Similarly, the median rate for a 36-month used auto loan was 4.2% in the week ended May 27 compared to 4.0% in the last week of March.