Credit Union Development Initiatives

The National Credit Union Administration's (NCUA) mission is to foster
the safety and soundness of federally insured credit unions and to
better enable the credit union community to extend credit for productive
and provident purposes. During 2003, NCUA focused on

1.  creating economic empowerment through credit union access into
    neighborhoods and communities lacking access to low-cost financial
    services;

2.  building partnerships between credit unions and organizations
    providing assistance to the credit union and it's membership; and

3.  providing assistance to low-income designated and small credit
    unions.

This year's highlights are listed on this page and details are outlined
throughout the report:

*Field of Membership Expansions into Underserved Areas*. Any federal
credit union may include communities satisfying the definition of an
underserved area to their field of membership. Over 25 million potential
members from underserved areas were added to the credit unions' fields
of membership in 2003. Credit unions wishing to expand into investment
areas can obtain more information from the NCUA website.

*Public and Private Partnerships*. NCUA management and field staff have
been continuing their efforts in facilitating partnerships between
organizations and credit unions through Access Across America and the
Partnering and Leadership Successes (PALS) Initiative. Examples of
successful partnerships efforts include:

[Small Business Administration]{.underline}:

NCUA continues to work with SBA in order to increase credit union member
business lending opportunities. The number of SBA lender participants
doubled in 2003 to 128 participants.

[NeighborWorks® Organizations]{.underline}:

Credit unions in New Hampshire have made a \$35 million commitment to
partner with NW organizations in order to assist first time homebuyers.
NCUA's Community Development Revolving Loan Fund (Fund) will be
facilitating these types of partnerships by providing grant funds in
2004.

[Community Development Financial Institutions Fund (CDFI)]{.underline}:
The CDFI awarded \$1.1 million in assistance to five credit unions in
2003. CDFI also provided staff to make presentations at credit union
workshops.

[Internal Revenue Service]{.underline}: One hundred twenty credit unions
have developed a partnership with IRS since 2002. In 2003, the Office of
Credit Union Development (OCUD) allocated \$50,000 to 22 credit unions
to offset the costs of the administration of the IRS' Volunteer Income
Tax Assistance (VITA) program. Based on the success of the 2003 VITA
grant program, the OCUD earmarked \$75,000 in funds this year.

*Assistance for Small and Low-Income Designated Unions (LICU)***:** The
OCUD provides assistance to LICUs through the grant and loan programs.
During 2003, OCUD received 226 technical assistance requests totaling
\$1.3 million and approved 189 requests amounting to \$460,242. The OCUD
also approved 7 loans totaling \$1 million during 2003. The LICU
financial highlights are located at the end of this report.

The regions completed 45 workshops that were attended by more than 1,612
credit union representatives. The NCUA staff also performed 699
on-**site contacts at small credit unions during 2003.**

[Field of Membership (FOM) --Underserved Areas Expansions]{.underline}

NCUA continues to provide information relating to FOM expansion into
underserved areas during the examination process and during workshops.
The FOM underserved areas expansion activity for the last three years is
shown in Figure 1.

NCUA will continue to highlight the need to bring credit union service
to underserved communities through *Access Across America*.

[]{.mark}

Figure 1

+-------------+------------------+------------------+------------------+
| **Period**  | **1/1/01 to      | **1/1/02 to      | **1/1/03 to      |
|             | 12/31/01**       | 12/31/02**       | 12/31/03**       |
+-------------+------------------+------------------+------------------+
| Region      | \# of            | \# of Potential  | \# of Potential  |
|             |                  | Members          | Members          |
|             | Potential        |                  |                  |
|             | Members          |                  |                  |
+-------------+------------------+------------------+------------------+
| # I         | 754,458          | 1,749,268        | 2,381,916        |
+-------------+------------------+------------------+------------------+
| II          | 1,440,625        | 5,705,478        | 5,114,650        |
+-------------+------------------+------------------+------------------+
| III         | 4,283,816        | 3,489,840        | 2,264,555        |
+-------------+------------------+------------------+------------------+
| IV          | 1,766,971        | 4,234,721        | 8,568,549        |
+-------------+------------------+------------------+------------------+
| V           | 5,650,892        | 5,578,120        | 5,196,449        |
+-------------+------------------+------------------+------------------+
| VI          | 2,229,875        | 2,793,646        | 1,627,295        |
+-------------+------------------+------------------+------------------+
| #### Total  | **16,126,637**   | **23,551,073**   | **25,153,414**   |
+-------------+------------------+------------------+------------------+

# []{.mark}

## [Small Credit Union Program]{.underline}

The NCUA Board approved a national Small Credit Union Program (SCUP) in
1999. The purpose of the SCUP is to facilitate the Board\'s goals of
promoting the development of financially healthy small and low-income
designated credit unions, and encourage the formation of newly chartered
credit unions.

[]{.mark}

This program was designed to provide assistance to credit unions that
fall within the following criteria:

-   credit unions with assets under \$5 million;

-   newly chartered credit unions in operation less than 10 years and
    with assets under \$10 million; and

-   low - income designated credit unions.

[]{.mark}

Credit unions that fall within the SCUP criteria can participate in the
program and can contact their regional office to request assistance.
There is no obligation for credit unions to participate in this program,
but the program does provide the unique opportunity for those smaller
credit unions to obtain advice and/or assistance in areas where they may
need to strengthen their expertise.

[]{.mark}

Figure 2 shows the total number of all federally insured credit unions
that are eligible and those credit unions that are participating in the
regional SCUP as of December 31, 2003.

Figure 2

+---------------------+----------------------+-------------------------+
|                     | **Eligible to        | **Participating in      |
|                     | Participate in       | SCUP**                  |
|                     | SCUP**               |                         |
+---------------------+----------------------+-------------------------+
| **Total at**        | 4,381                | 721                     |
|                     |                      |                         |
| **2001**[^1]        |                      |                         |
+---------------------+----------------------+-------------------------+
| **Total at          | 3,796                | 841                     |
| 2002**[^2]          |                      |                         |
+---------------------+----------------------+-------------------------+
| **Total at          | 3,533                | 868                     |
| 2003**[^3]          |                      |                         |
+---------------------+----------------------+-------------------------+

[]{.mark}

The number of credit unions participating in the SCUP has increased by
27 during 2003.

[]{.mark}

Assistance is also provided to groups interested in chartering a credit
union. There were 12 credit unions chartered during 2003--eight federal
and four state charters.

# *[SCUP Workshops]{.underline}*

The regions completed 45 workshops that were attended ***by more than
1,612 credit union representatives***. These workshops were targeted
toward assisting credit unions to reverse adverse trends caused by the
current economy; to expand into underserved areas; and to correct safety
and soundness issues that if left unresolved might impact the viability
of a credit union.

# [Community Development Revolving Loan Fund]{.underline}

The OCUD administers the Community Development Revolving Loan Fund
(Fund). The Fund is a source of low-interest loans and technical
assistance grants to LICUs. The Fund's objective is to foster community
development through the improvement of credit union operations and
service to members and community.

# []{.mark}

# [Loan Program]{.underline}

The Fund approved 7 loans totaling \$1 million during 2003. The Fund's
loan portfolio at December 31, 2003, had 58 loans with outstanding
balances totaling \$5,312,559. Economic factors have impacted credit
unions' liquidity levels and ability to arbitrage the loan funds;
therefore current loan demand is low. Figure 3 shows the amount of loans
outstanding since 1998.

Figure 3

![](media/image1.wmf)

***[Technical Assistance Grant Program]{.underline}***

The Fund's Technical Assistance (TA) Grant Program provides operational
funding for technology, member service enhancements, student internship
programs, training, marketing, audits, strategic planning and other
needed items during 2003. During 2003, the Fund received 226 technical
assistance requests totaling \$1.3 million and approved 189 requests
amounting to \$460,242. Figure 4 shows the amount of grants awarded
credit unions since 1997.

Figure 4

# ![](media/image2.wmf)

# [Low Income Designation]{.underline}

"Low-income" (LI) is an official NCUA designation granted to a credit
union that serves a membership of which more than half its members earn
less than 80 percent of the average for all wage earners or those
members whose annual household income falls at or below 80 percent of
the median household income for the nation. These income measurement
standards can be obtained from OCUD. Credit unions with this designation
are measured against the same standards of financial soundness and
operational professionalism as other credit unions, and in addition are
granted these benefits:

1.  *Nonmember Deposits*. Greater authority to accept deposits from
    nonmembers.

2.  *Participation in the Community Development Revolving Loan Fund
    (Fund).* Access to low-interest loans, deposits, and technical
    assistance from the Fund.

3.  *Secondary Capital*. Ability to include this account (as outlined in
    the NCUA Rules and Regulations Part 701.34 and 702) in the credit
    union's net worth ratio computation.

4.  *Member Business Loans*. Exception to the aggregate loan limit for
    business loans.

The number of LI designated credit unions (LICUs) increased from 913 at
the end 2002 to 964 at December 31, 2003, for a net increase of 51
credit unions during 2003. LICU activity during 2003 consisted of the
following: 78 new designations, eight new charters, 28 mergers, two
purchase & assumptions, one lost designation, and four liquidations.
Figure 5 illustrates the growth of the number of LICUs. A list of LI
designated credit unions can be found on the NCUA Web site.

# 

# Figure 5

![](media/image3.wmf)

[]{.mark}

Figure 6 illustrates the growth of LICUs by region.

Figure 6

+-----------------+------------+------------+------------+------------+
| ######## Region | #          | ##### 2001 | **2002**   | **2003**   |
|                 | ##### 2000 |            |            |            |
+-----------------+------------+------------+------------+------------+
| ### I           | 64         | 62         | 69         | 93         |
+-----------------+------------+------------+------------+------------+
| **II**          | 69         | 122        | 137        | 137        |
+-----------------+------------+------------+------------+------------+
| **III**         | 145        | 171        | 216        | 230        |
+-----------------+------------+------------+------------+------------+
| **IV**          | 65         | 98         | 138        | 144        |
+-----------------+------------+------------+------------+------------+
| **V**           | 205        | 223        | 236        | 241        |
+-----------------+------------+------------+------------+------------+
| **VI**          | 97         | 113        | 117        | 119        |
+-----------------+------------+------------+------------+------------+
| **Total LICUs** | **645**    | **789**    | **913**    | **964**    |
+-----------------+------------+------------+------------+------------+

[]{.mark}

**[Financial Growth]{.underline}**[^4]

Figure 7 displays how LICUs compared to all federally insured credit
unions in various growth rate areas at December 31, 2003.

Of special note is the increase of potential members added to credit
unions' charters. As stated in a previous section, credit unions have
added underserved areas to their membership (refer to Figure 1).

Figure 7

  ---------------------------------- ------------- -----------------------
  **Growth % Rates (Annualized)**                  

  []{.mark}                          **LICUs**     **All Credit
                                                   Unions**[^5]

  Share Growth                       10.4          9.1

  Net Worth Growth                   8.7           9.5

  Loan Growth                        9.2           9.7

  Asset Growth                       10.5          9.5

  Investment Growth                  17.1          9.1

  Current Member Growth              3.6           1.9

  Potential Mbr. Growth              8             20.8
  ---------------------------------- ------------- -----------------------

# 

# *Assets*

The assets of LI designated credit unions increased \$2.4 billion during
2003, from \$12.9 billion at yearend 2002 to \$15.3 billion as of
December 31, 2003. Nearly 58 percent of the growth (\$1.4 billion) was
attributed to 78 new designations during 2003. Figure 8 illustrates the
growth in total assets of LICUs since 1998.

Figure 8

![](media/image4.wmf)

The asset structure for all LICUs is shown in Figure 9. LICUs have a
loan to assets ratio of 64.9 percent, which compares to the 61.6 percent
ratio of all federally insured credit unions.

Figure 9

![](media/image5.wmf)

All credit unions primarily fund loan programs with member deposits.
Figure 10 illustrates the loan to share ratio trend for LICUs and all
federally insured credit unions. The LICUs historically have higher loan
to share ratios than all federally insured credit unions.

Figure 10

![](media/image6.wmf)

*Loans*

LICUs reported holding \$9.9 billion in loans as of December 31, 2003.
Their loan portfolio mix for December 2003 is illustrated in Figure 11.
There were no material changes to the portfolio mix during the last
year.

**Figure 11**

![](media/image7.wmf)

*Loan Quality*

The December 31, 2003, delinquent loan to total loans ratio for LICUs is
1.6 percent. The delinquency ratio for LICUs has historically been one
percent higher than the ratio for all federally insured credit unions as
shown in Figure 12.

Figure 12

![](media/image8.wmf)

Reasons for the higher delinquency ratio found in LICUs appear to be:

-   The LICU's loan portfolio mix consists of four percent more in the
    unsecured credit category (e.g., unsecured and credit cards) and
    four percent more in the used auto loan category than all credit
    unions. In addition, the LICU's loan portfolio mix consists of 16
    percent less in the real estate loans categories.

-   The LICUs members' income levels are lower which limits the liquid
    funds of members that are used for loan repayments.

The delinquency ratio of the low-income credit unions decreased by 0.13
percent during 2003 while the delinquent ratio for all federally insured
credit unions declined (0.04 percent) slightly for the same period.
Figure 13 lists the December 31, 2003, delinquency ratios for each
range.

Figure 13

  ------------------------- ---------------------- ----------------------
  **Delinquency Range**     **LI Credit Unions**   **All Credit Unions**

  **2 to 6 months**         1.02                   0.53

  **6 to 12 months**        0.38                   0.17

  **12 months and more**    0.20                   0.06

  **Total Delinquency**     1.60                   0.76
  ------------------------- ---------------------- ----------------------

[]{.mark}

The charge-off ratios for both LICUs and federally insured credit unions
are shown in Figure 14. The LICUs net charge-offs ratios of all
federally insured credit unions and LICUs increased by approximately 0.5
percent. The amount of loans charged-off during 2003 due to bankruptcy
for LICUs was 29.7 percent whereas the ratio was 37.1 percent for all
federally insured credit unions. Therefore, LICUs had a greater
opportunity to collect from the delinquent members due to the decreased
level of bankruptcies.

[]{.mark}

Figure 14

+--------------------+----------+----------+-----------+-------------+
|                    | **Pe     |          |           |             |
|                    | rcentage |          |           |             |
|                    | of       |          |           |             |
|                    | Average  |          |           |             |
|                    | Loans**  |          |           |             |
+--------------------+----------+----------+-----------+-------------+
|                    | **Dec 02 | **       | **Dec 02  | **Dec 03**  |
|                    | LICU**   | Dec-03** | All CUs** |             |
|                    |          |          |           | **All**     |
|                    |          | **LICU** |           |             |
|                    |          |          |           | **CUs**     |
+--------------------+----------+----------+-----------+-------------+
| **Charge-off       | 0.86     | 0.90     | 0.60      | 0.65        |
| ratio**            |          |          |           |             |
+--------------------+----------+----------+-----------+-------------+
| **Recoveries       | 0.15     | 0.13     | 0.09      | 0.09        |
| ratio**            |          |          |           |             |
+--------------------+----------+----------+-----------+-------------+
| **Net Charge-off   | 0.71     | 0.77     | 0.51      | 0.56        |
| ratio**            |          |          |           |             |
+--------------------+----------+----------+-----------+-------------+

[]{.mark}

*Investments*

The December 31, 2003, combined financials for LICUs indicate that the
investment portfolio tends to be slightly less liquid (refer to Figure
15 for investment mix) than the portfolio held by all federally insured
credit unions.

Figure 15

  ------------------------------ ----------------- ----------------------
  **Maturity or Repricing        **Percentage of   
  Period**                       Total Investments 
                                 2002**            

                                 **LICUs**         **All CUs**

  \<1 year                       39.5              47.4

  1 to 3 years                   39.1              34.2

  3 to 10 years                  19.2              16.9

  \> 10 years                    2.2               1.5
  ------------------------------ ----------------- ----------------------

[]{.mark}

LICUs reported \$3.1 billion in investments at December 31, 2003.
Changes in the investment portfolio mix during 2003 included a six
percent movement to the Federal Agency Securities category from the
Corporate Credit Union category. The portfolio mix for LICUs is
illustrated in Figure 16.

Figure 16

![](media/image9.wmf)

The LICU's investment portfolio mix differs from all federally insured
credit unions as follows:

-   Investments in banks/S&Ls are 21 percent higher in LICUs than all
    credit unions.

-   Investments in Federal Agency Securities are 21 percent lower in
    LICUs than all credit unions.

*Shares*

As of December 31, 2003, LICUs report over \$13.4 billion in savings and
deposits. Another source of deposits can be obtained from nonmembers.
Changes in the share portfolio mix during 2003 included a one percent
movement from the regular share category to the money market category.
Figure 17 shows the share portfolio mix for LICUs.

[]{.mark}

Figure 17

![](media/image10.wmf)

Notable differences in the share portfolio mix between the LICUs and all
credit unions include:

-   The LICUs portfolio has eight percent less in the money market
    category than all credit unions.

-   The LICUs portfolio has eight percent more in the regular share
    category than all credit unions.

-   The LICUs portfolio has two percent more in the share certificates
    category than all credit unions.

***Net Worth***

Low-income credit unions as a group are well capitalized with a net
worth ratio of 10.94 percent including secondary capital and 10.85
percent without secondary capital. Figure 18 displays net worth[^6] to
assets ratios. LICUs net worth ratios continue to be slightly higher
than all credit unions (10.7 percent). The total amount of secondary
capital accounts increased by 14.5 percent during 2003. The year-end
secondary capital account balances over the past four periods are shown
in Figure 19.

Figure 18

![](media/image11.wmf)

Figure 19

Secondary Capital in Millions at Year End

  ---------------------------- ---------- ---------- ---------- ----------
  **Year End**                 **2000**   **2001**   **2002**   **2003**

  **Secondary Capital \$**     7.9        8.9        12.4       14.2
  ---------------------------- ---------- ---------- ---------- ----------

# 

# *Earnings*

The 2003 return on average assets (ROA) ratio for all LICUs was 0.9
percent. This compares to the 1.0 percent ROA recorded by the combined
federally insured credit unions. Figure 20 illustrates the composition
of the ROA. Refer to subsequent topic headings for more detail.

**Figure 20**

+---------------+----------+----------+----------+--------+---------+
|               | **Pe     |          |          |        |         |
|               | rcentage |          |          |        |         |
|               | of       |          |          |        |         |
|               | Average  |          |          |        |         |
|               | Assets** |          |          |        |         |
+---------------+----------+----------+----------+--------+---------+
|               | **Dec    | **Dec    | **Dec    | **Dec  | **Dec   |
|               | 01**     | 02**     | 03**     | 02**   | 03**    |
|               |          |          |          |        |         |
|               | **LICU** | **LICU** | **LICU** | *      | **All** |
|               |          |          |          | *All** |         |
|               |          |          |          |        | **CUs** |
|               |          |          |          | *      |         |
|               |          |          |          | *CUs** |         |
+---------------+----------+----------+----------+--------+---------+
| **Gross**     | 8.5%     | 7.6%     | 6.9%     | 6.9%   | 6.2%    |
|               |          |          |          |        |         |
| **Income**    |          |          |          |        |         |
+---------------+----------+----------+----------+--------+---------+
| **Provision** | 0.5%     | 0.5%     | 0.4%     | 0.4%   | 0.4%    |
|               |          |          |          |        |         |
| **for Loan**  |          |          |          |        |         |
|               |          |          |          |        |         |
| **Loss        |          |          |          |        |         |
| Expenses**    |          |          |          |        |         |
+---------------+----------+----------+----------+--------+---------+
| **Cost of**   | 3.2%     | 2.2%     | 1.6%     | 2.3%   | 1.7%    |
|               |          |          |          |        |         |
| **Funds       |          |          |          |        |         |
| Expenses**    |          |          |          |        |         |
+---------------+----------+----------+----------+--------+---------+
| **Operating   | 4.0%     | 4.0%     | 3.9%     | 3.3%   | 3.2%    |
| Expenses**    |          |          |          |        |         |
+---------------+----------+----------+----------+--------+---------+
| **ROA**       | 0.8%     | 0.9%     | 0.9%     | 1.0%   | 1.0%    |
+---------------+----------+----------+----------+--------+---------+

# *Income*

LICUs gross income to average assets ratio declined by 0.7 percent since
2002. Figure 21 illustrates the breakdown of the elements that compose
LICUs' gross income. Changes in the income portfolio mix in 2003
included a one percent decline in loan income, one percent increase in
other operating income, two percent increase in investment income, and a
two percent decrease in fee income categories.

Notable differences in the income mix between the LICUs and all credit
unions include:

-   The LICUs income from investments is 5 percent lower than all credit
    unions. Whereas, LICU loan income is 6 percent higher than all
    credit unions.

-   The LICUs other operating income is two percent lower.

[]{.mark}

[]{.mark}

Figure 21

![](media/image12.wmf)

# *Expenses*

Figure 22 shows the breakdown of expenses for LICUs. Most of their
ratios are comparable with all federally insured credit unions except
the member insurance and loan servicing categories.

[]{.mark}

[]{.mark}

[]{.mark}

[]{.mark}

[]{.mark}

[]{.mark}

[]{.mark}

[]{.mark}

[]{.mark}

[]{.mark}

[]{.mark}

**Figure 22**

+---------------------+-----------+-----------+-----------+-----------+
| **Expenses**        | **LI**    | ###       | **All**   | **All**   |
|                     |           | ###### LI |           |           |
| **to Total Expenses | **CUs**   |           | **CUs**   | **CUs**   |
| Ratio**             |           | **CUs**   |           |           |
|                     | *         |           | *         | *         |
|                     | *Dec-02** | *         | *Dec-02** | *Dec-03** |
|                     |           | *Dec-03** |           |           |
+---------------------+-----------+-----------+-----------+-----------+
| Employee Comp &     | 44.3      | 45.2      | 44.8      | 45.0      |
| Benefits            |           |           |           |           |
+---------------------+-----------+-----------+-----------+-----------+
| Travel & Conference | 1.4       | 1.5       | 1.3       | 1.3       |
+---------------------+-----------+-----------+-----------+-----------+
| Office Occupancy    | 5.6       | 5.7       | 5.8       | 5.9       |
+---------------------+-----------+-----------+-----------+-----------+
| Office Operation    | 19.1      | 19.1      | 19.8      | 19.4      |
+---------------------+-----------+-----------+-----------+-----------+
| Education &         | 2.8       | 3.0       | 3.0       | 3.1       |
| Promotion           |           |           |           |           |
+---------------------+-----------+-----------+-----------+-----------+
| Loan Servicing      | 3.4       | 3.8       | 4.9       | 5.0       |
+---------------------+-----------+-----------+-----------+-----------+
| Professional &      | 6.7       | 7.0       | 6.7       | 6.7       |
| Outside Services    |           |           |           |           |
+---------------------+-----------+-----------+-----------+-----------+
| Provision for Loan  | 11.6      | 9.6       | 9.4       | 9.7       |
| Losses              |           |           |           |           |
+---------------------+-----------+-----------+-----------+-----------+
| Member Insurance    | 1.7       | 1.4       | 0.8       | 0.7       |
+---------------------+-----------+-----------+-----------+-----------+
| Operating           | 0.6       | 0.6       | 0.5       | 0.5       |
+---------------------+-----------+-----------+-----------+-----------+
| Misc.               | 2.8       | 3.1       | 2.9       | 2.6       |
+---------------------+-----------+-----------+-----------+-----------+

[]{.mark}

# *Cost of Funds*

The LICUs' 2003 cost of funds to average assets ratio is comparable with
all federally insured credit unions (refer to Figure 20).

**Financial Highlights**

The low income designated credit unions (LICUs) financial highlights are
as follows:

-   Asset growth of 10.5 percent - - comparable to the 9.5 percent
    reported by all federally insured credit unions.

-   Current member growth of 3.6 percent - - all credit unions reported
    a 1.9 percent growth.

-   A total loan to assets ratio of 64.9 percent - - all credit unions
    reported a ratio of 61.6 percent.

-   A delinquency ratio of 1.6 percent - - all credit unions reported a
    ratio of 0.76 percent. The delinquency ratio for LICUs has
    historically been approximately one percent higher than all credit
    unions.

-   A net charge-off ratio of 0.77 percent - - all credit unions
    reported a ratio of 0.56 percent.

-   A net worth ratio of 10.94 percent - - comparable to 10.7 reported
    by all credit unions.

-   A return on average assets ratio of 0.9 percent - - all credit
    unions reported a 1.0 percent ratio.

For more information regarding the programs outlined in this report,
contact your NCUA regional office or the Office of Credit Union
Development.

[^1]: Eligible federally insured credit unions' numbers were produced
    using December 31, 2001, call report data.

[^2]: Eligible federally insured credit unions' numbers were produced
    using December 31, 2002, call report data.

[^3]: Eligible federally insured credit unions' numbers were produced
    using December 31, 2003, call report data.

[^4]: The statistics displayed in this table and subsequent charts and
    graphs reflect data reported on Financial Performance Reports by the
    same credit unions for the periods December 31, 2002, and December
    31, 2003.

[^5]: All federally insured credit unions.

[^6]: Net worth includes the retained earnings balance of the credit
    union at quarter end as determined by generally accepted accounting
    principles. For LICUs, net worth also includes secondary capital
    accounts that are uninsured and subordinate to all other claims,
    including claims of creditors, shareholders, and the NCUSIF.