Ultimate Benchmarking Guide For Credit Unions

What Is Benchmarking?

Benchmarking is the interpretation and analysis of financial information in order to make direct performance comparisons to other credit unions, banks, and customized peer groups. It enables a credit union to track internal goals, identify opportunities, reinforce strengths, and reveal weaknesses.

When benchmarking with your peers, it’s important to note that with any performance metric, “success” looks different for each individual institution based on its goals, current strategy, and membership needs.

Why Should I Benchmark?

It’s impossible to properly gauge performance in key areas without accurate and detailed knowledge of your credit union’s competition. Benchmarking shows where you need to make changes and the areas you can build upon. Basically, it provides the numbers to back up (or disprove) your assumptions.

At a more granular level, benchmarking also helps you:

• Gain a better understanding of your market.
• Monitor progress toward specific goals.
• Identify potential performance pitfalls.
• Understand and spot patterns.
• Provide actionable and meaningful information to your team.
• Reduce the likelihood of decisions being made for intuitive or emotional reasons.
• Review operations at a high level.

If done regularly, benchmarking can have a direct impact on the bottom line. In the past, this was a laborious process reserved only for those with the most advanced financial knowledge. For instance, benchmarking against a local bank involved rectifying differences between the NCUA and FDIC call reports.

Thankfully, there are now tools available that do this sort of work for you and make all the necessary data easily accessible. It’s now possible for credit union professionals across all departments to use benchmarking for conducting data-backed performance analysis. The key is knowing what metrics to look for.

Start Measuring Performance More Effectively

Want to learn more about performance benchmarking and which key metrics all credit union executives need to look for?

Download the free Comprehensive Guide To Credit Union Performance Benchmarking.

• What is benchmarking and why are credit unions using data to fuel their strategies?
• Key performance benchmarks for department leaders (CEO/governance, finance, lending, marketing and more).
• How to avoid common performance-benchmarking pitfalls.
• Methods for gathering relevant performance data.