Frustration w/Banks = CU Deposit Surge Posted by AVCU on 10:31 AM

As reported in Texas League news, the first quarter typically means an increase in liquidity at credit unions. But last year the liquidity surge of the first quarter never abated. That tide of money kept pouring into credit unions in 2009 to the tune of an additional $72 billion, according to figures just released by the National Credit Union Administration (NCUA)-with $14 billion of it coming in the fourth quarter. A number of reasons have surfaced to explain the steady rise in liquidity at credit unions, but one that hasn't been mentioned much is anger.

Two studies released in 2009 . . . the University of Michigan's American Customer Satisfaction Index, and a study conducted by J.D. Powers and Associates . . . point out that consumers are becoming increasingly dissatisfied with banks. The J.D. Powers study found that only 35% of customers were highly committed to their retail bank in 2009, compared to 37% in 2008 and 41% in 2007. Fees are the biggest gripe among bank consumers, the Powers report said. One in three customers who switched banks in the past 12 months did so to avoid high bank fees.

"Customer satisfaction with banking . . . was quite turbulent for individual banks," according to the American Customer Service Index (ACSI). Smaller banks fared better in the satisfaction ranking than large banks. Smaller banks scored an 80 while larger banks notched a 75. "Small banks tend to provide better and more personalized service . . . Credit unions fared even better with an overall score of 84, built largely on the same individualized approach to service that distinguishes small banks," the University of Michigan's report stated.