The Funding Gap — Q3 2026
Lending Ahead of Shares
Loans grew 2.19% and shares 0.52% in Q3 2026 on the panel, the 4,157 credit unions that filed every quarter from Q2 2025 to Q3 2026. That is a gap of 166‱ between the two growth rates, against 71‱ for the same credit unions in Q3 2025. The panel holds 98.6% of the assets of the 4,215 credit unions that filed for Q2 2026. Credit unions that merged, missed a quarter or had not filed for Q3 2026 hold the rest, so the panel's figures describe those credit unions, not the system.
Lending rose widely. Loans grew at 2,582 of the panel's credit unions in Q3 2026, against 2,326 in Q3 2025, and the loans-to-shares ratio rose at 2,689. For the panel as a whole the ratio rose 137‱ in the quarter, to 84.3%. Without Navy Federal Credit Union, which holds 8.2% of the panel's assets, the ratio rose from 82.8% to 84.2%, and loans grew 2.18% against shares at 0.56%, so no single institution sets the quarter's gap.
A Wider Third-Quarter Gap: the table gives the panel's loan and share growth in each quarter from Q3 2025 to Q3 2026, with the loans-to-shares ratio at quarter-end. Shares outgrew loans in Q4 2025 and Q1 2026, as they do in the inflow quarters, and loans outgrew shares in the other three; the Q3 2026 gap is wider than Q3 2025's and narrower than Q2 2026's.
A Second Rise in Borrowings
Signals — Q2 2026 (October 5, 2026) named borrowings as the item to watch: they rose in Q2 2025 too, then fell, so a second consecutive rise would be new. On the panel the second rise came. Borrowings rose 5.05% in Q2 2026 and 6.16% in Q3 2026, to $82.2B. A credit union that absorbs another in a merger takes its borrowings onto its own books, and its equity acquired in merger rises; without those credit unions, the rises were 6.42% and 4.36%. As reported for the system, borrowings rose 6.05% in Q3 2026 after 4.94% in Q2 2026; before that they last rose in two consecutive quarters in 2023, by 8.20% in Q3 2023 and 5.34% in Q4 2023, to a peak of $136.3B.
A few credit unions account for most of the net rise. Of the 4,157 on the panel, 349 borrowed more at September 30, 2026 than at June 30, 2026 and 302 less, against 243 and 321 in Q3 2025, and 3,287 held no borrowings at either date. Rises summed to $9.1B and falls to $4.3B, and the 10 largest rises equal 70.5% of the net rise of $4.8B.
Navy Federal's borrowings rose $851M in Q3 2026, to $7.2B, the largest rise on the panel and 17.8% of the net. At Q2 2025 they stood at $8.7B. Without Navy Federal, panel borrowings rose 5.52% in Q3 2026.
Rising from a Low Count: the table gives panel borrowings at each quarter-end from Q3 2025 to Q3 2026, the change in each quarter with and without the credit unions that recorded a merger in it, and how many credit unions borrowed more and less. Borrowings fell for three quarters and rose for two, and the count of credit unions that borrowed more went from 122 in Q1 2026 to 349 in Q3 2026.
Borrowings on the Panel, Q3 2025–Q3 2026 (credit unions that filed every quarter, Q2 2025–Q3 2026)
Copy link| Q3 2025 | $82.0B | -1.34% | -0.08% | 243 | 321 |
| Q4 2025 | $78.0B | -4.80% | -3.95% | 217 | 369 |
| Q1 2026 | $73.7B | -5.55% | -5.55% | 122 | 423 |
| Q2 2026 | $77.4B | 5.05% | 6.42% | 263 | 252 |
| Q3 2026 | $82.2B | 6.16% | 4.36% | 349 | 302 |
Cash, Investments and Certificates
Loans rose $38.0B on the panel in Q3 2026, shares $11.0B and borrowings $4.8B. Cash and short-term investments fell $20.4B, or 7.11%, after a fall of 2.43% in Q3 2025, and 2,775 of the 4,157 credit unions held less of it at September 30, 2026 than at June 30, 2026, against 2,337 a year earlier. Investments fell 1.37%, after rising 1.31% in Q3 2025. Of that fall, 44.5% was at Navy Federal, whose investments fell $2.3B; without it, panel investments fell 0.85%.
Certificate growth slowed. Share certificates grew 0.50% in Q3 2026, against 2.28% in Q3 2025, while money market shares grew 1.67%. Navy Federal's certificates fell $1.4B in the quarter. Without it, certificates grew 0.82%, against 2.22% in Q3 2025, so the slowdown does not rest on one credit union.
Cash Ran Down: the table compares Q3 2026 with Q3 2025 for each line of the panel's balance sheet that lending draws on, with Q3 2026 growth without Navy Federal beside it. Loans, borrowings and money market shares grew faster than a year earlier; shares and certificates grew more slowly, and cash and investments fell further or turned down.
Funding Lines on the Panel, Q3 2026 against Q3 2025 (credit unions that filed every quarter, Q2 2025–Q3 2026)
Copy link| Loans | 1.46% | 2.19% | 2.18% |
| Shares | 0.75% | 0.52% | 0.56% |
| Share certificates | 2.28% | 0.50% | 0.82% |
| Money market shares | 1.51% | 1.67% | 1.61% |
| Borrowings | -1.34% | 6.16% | 5.52% |
| Cash and short-term investments | -2.43% | -7.11% | -7.16% |
| Investments | 1.31% | -1.37% | -0.85% |
The Seasonal Reading, Tested
The Funding Gap — Q2 2026 (October 21, 2026) read the second-quarter gap between loan and share growth as seasonal: shares stall while lending opens in the second and third quarters, and inflows restore shares in the fourth and first. Its evidence was the year. Shares had grown faster than loans over the four quarters to June, and the return to wholesale funding that the 2025 edition expected had not come. On the panel that order has reversed. Loans grew 7.62% and shares 6.77% over the four quarters to September, where to June shares grew 7.01% and loans 6.86%. A four-quarter comparison takes the season out, so its reversal is not itself seasonal. It turned on one quarter: the window dropped Q3 2025 and added Q3 2026, in which loans grew faster and shares more slowly on the same credit unions.
A third-quarter gap belongs to the seasonal pattern, and so does its closing. As reported for the system, loans grew 1.80% while shares fell 0.10% in Q3 2023, and loans grew 0.78% against shares at 0.42% in Q3 2024. Shares then outgrew loans in the fourth quarter: 1.27% against 0.91% in Q4 2024 as reported, and 2.08% against 1.47% in Q4 2025 on the panel. Measured as reported, the four-quarter comparison moved toward shares by 92‱ in Q4 2024 and by 24‱ in Q4 2025. On the panel loans lead by 84‱ over the four quarters to September, after trailing by 16‱ to June.
We read the third quarter as weighing on the seasonal reading without overturning it, and the account as unresolved. The evidence that reading cited, shares ahead of loans over the year, does not hold through September on the panel or as reported for the system, and borrowings rose a second time where in 2025 they fell. Against that, the reversal rests on one quarter and on a lead to June of 16‱, a few credit unions account for most of the net rise in borrowings, and the fourth quarter, in which shares outgrew loans in each of the last two years, has not reported.
Order Reversed: the table gives loan and share growth over the four quarters to Q2 2026 and to Q3 2026 for the panel, for the panel without the credit unions that recorded a merger from Q3 2025 to Q3 2026, and for the panel without Navy Federal. In all three, shares were level with loans or ahead over the four quarters to June and loans were ahead over the four quarters to September, so the reversal rests on neither mergers nor Navy Federal.
Growth over Four Quarters to Q2 2026 and Q3 2026 (credit unions that filed every quarter, Q2 2025–Q3 2026)
Copy link| All panel credit unions | 4,157 | 6.86% | 7.01% | 7.62% | 6.77% |
| Without credit unions that recorded a merger | 3,890 | 6.91% | 6.92% | 7.71% | 6.80% |
| Without Navy Federal | 4,156 | 6.92% | 6.98% | 7.71% | 6.84% |
What Settles It
Expectation H-2026Q2-breakdowns-funding-01, made in The Funding Gap — Q2 2026, stands as published: system borrowings at Q4 2026 below their Q4 2025 level of $83.0B. On the panel, borrowings at September 30, 2026 stood 5.34% above their own Q4 2025 level. As reported, system borrowings at September 30, 2026 were $83.7B, 0.88% above that Q4 2025 level.
Test H-2026Q3-breakdowns-funding-01. Whether system share growth exceeds system loan growth over the four quarters from Q4 2025 to Q4 2026. The population is all federally insured credit unions, read from system totals as reported; the measure is the growth in total shares less the growth in total loans over the four quarters, scored in whole ‱ against a threshold of zero. Settles with the Q4 2026 data; made in November 2026, before the quarter ends. A reading above zero would be consistent with a seasonal gap, shares ahead over the full year as they were at Q4 2024 and Q4 2025; a reading at or below zero would be consistent with lending that outran shares over a full year, which the seasonal reading does not account for. We take no side: as reported, shares led by 30‱ over the four quarters to Q2 2026 and loans by 71‱ over the four quarters to Q3 2026; on the panel, loans lead by 84‱ over the four quarters to Q3 2026; and the fourth quarter moved the comparison toward shares by 92‱ in 2024 and 24‱ in 2025.
Borrowings and the Year, as Reported: the table gives system borrowings at each quarter-end from Q3 2023 to Q2 2026, their change in the quarter, and loan and share growth over the four quarters to each quarter-end. Borrowings rose to the Q4 2023 peak and in no two consecutive quarters after it to Q2 2026, and shares outgrew loans over four quarters at every quarter-end from Q3 2024 to Q2 2026.
System Borrowings and Growth over Four Quarters, Q3 2023–Q2 2026 (all federally insured credit unions, as reported)
Copy link| Q3 2023 | $129.4B | 8.20% | 9.06% | 0.87% |
| Q4 2023 | $136.3B | 5.34% | 6.39% | 1.69% |
| Q1 2024 | $132.1B | -3.11% | 4.62% | 2.38% |
| Q2 2024 | $123.3B | -6.70% | 3.59% | 2.61% |
| Q3 2024 | $121.9B | -1.13% | 2.56% | 3.15% |
| Q4 2024 | $96.5B | -20.85% | 2.64% | 4.15% |
| Q1 2025 | $87.4B | -9.36% | 3.30% | 4.45% |
| Q2 2025 | $90.1B | 3.07% | 3.93% | 4.95% |
| Q3 2025 | $87.9B | -2.45% | 4.44% | 5.11% |
| Q4 2025 | $83.0B | -5.61% | 4.61% | 5.53% |
| Q1 2026 | $75.2B | -9.35% | 4.58% | 5.06% |
| Q2 2026 | $78.9B | 4.94% | 4.89% | 5.19% |
Connecting the Lines
This installment continues the Funding Gap thread of The Funding Gap — Q2 2025 (September 20, 2025) and The Funding Gap — Q2 2026 (October 21, 2026), and it answers the borrowings item that Signals — Q2 2026 (October 5, 2026) set to watch, on the panel and as reported for the system. The 2025 edition expected a turn to wholesale funding that the year after did not bring; the 2026 edition read the gap as seasonal. Two quarters of rising borrowings and a year in which loans outgrew shares now sit between those readings, and Test H-2026Q3-breakdowns-funding-01 asks which of them the year to Q4 2026 bears out.
- Every Q3 2026 figure not labeled as reported rests on the credit unions in release v2026.3.4 that filed every quarter from Q2 2025 to Q3 2026, not on the system.
- Growth on the panel compares the same credit unions at both ends and includes balances acquired in mergers, while system totals as reported, which the Q2 2026 edition printed, also lose the balances of charters that leave the data, so the page labels each basis where it shows both and gives panel figures without the credit unions that recorded a merger.
- Borrowings are the Call Report's total borrowings, which the report neither divides into advances and other borrowings nor prices, and cash and short-term investments is the Call Report line of that name, not the cash and deposits measure in the Q2 2026 edition.
- Growth rates are not seasonally adjusted, so the seasonal reading rests on the same quarters in earlier years, and the test on Q4 2026 is a question the report sets for data that end at September 30, 2026.
- Navy Federal Credit Union's figures are as filed and were not checked against its published statements.
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