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Thursday, Feb 29, 2024

The Number

Last month, the California Credit Union League reported the membership of L.A. County’s credit unions has reached a record high of 3.05 million people. That represents an increase of 5 percent, or 156,000 new members, in the last year. Dwight Johnston, chief economist for the Ontario-based league, said that membership has benefited from several trends, including increasing employment in the county. “You have to get people to work so they have money to put in a credit union,” he told the Business Journal. Since the Great Recession a consumer backlash against banks has pushed people to credit unions, and popular financial consultants such as Suze Orman and Dave Ramsey have advocated for credit unions. In addition, Johnston noted that credit unions have moved into auto loan financing. When dealers present would-be car buyers with various lenders, a credit union loan often ranks as the cheapest option. But the buyer must join the credit union to qualify for the loan. A new program by the industry has expanded credit unions’ presence on car lots, he explained. “That has been a boon on the lending side and the credit union automatically gets a new member,” he added. Some of the largest credit unions in L.A. County are based in the Valley region, including No. 1 ranked Logix Federal Credit Union in Burbank. Data for the study came from the 107 credit unions in the county, a number that has declined from 123 institutions two years ago. Johnston said it’s a function of economies of scale as the market evolves to fewer but larger credit unions. Nationally, he said over the last 25 years, the number of credit unions has shrunk from 12,000 to about 5,600.” He predicted that in the next few years, the number of credit unions in L.A. County will fall “well below 100.” – Joel Russell

Joel Russel
Joel Russel
Joel Russell joined the Los Angeles Business Journal in 2006 as a reporter. He transferred to sister publication San Fernando Valley Business Journal in 2012 as managing editor. Since he assumed the position of editor in 2015, the Business Journal has been recognized four times as the best small-circulation tabloid business publication in the country by the Alliance of Area Business Publishers. Previously, he worked as senior editor at Hispanic Business magazine and editor of Business Mexico.

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