Credit unions are buying banks.

Just that one sentence shows how much the script has flipped from a few years ago. Many of our previous assumptions about how the industry works, both here in the Northeast and across the country, are off the table.

Whether we’re talking regulatory uncertainty, evolving consumer demands, or digital transformation and all its challenges, the market is confusing. For leaders providing strategic direction through these uncharted waters, it’s hard to get a handle on things.

Based on what I’m seeing while talking with credit union leaders in the Northeast, here are the top priorities on people’s minds. Understanding them should give you a good sense of where the market is and where it’s headed.

Key Takeaways

• Regulation and risk are top of mind. Credit union leaders are working to balance regulatory pressure with their cooperative mission, building fluency and stronger engagement with policymakers to stay ahead of compliance demands.
• Innovation is no longer optional. From predictive analytics to seamless digital experiences, member expectations are pushing credit unions to modernize fast, or risk losing ground to banks and fintechs.
• Leadership depth will define the future. Without intentional succession planning and talent development, credit unions risk falling behind in a competitive, rapidly changing market.

Top Priorities Among Credit Union Leaders

Over the past 12 months, the banking and financial services industry has dealt with major change. Total assets in federally insured credit unions rose by $60 billion (2.6%) over the year ending in Q1 2025 to $2.37 trillion, with total loans outstanding increasing by $53 billion (3.3%) to $1.65 trillion.

Much of this growth has been driven by larger credit unions (assets $1 billion to $10 billion) and their notable asset and loan growth, as well as membership increases of 4.5%, holding approximately 53% of total system assets.

Here in the Northeast, we’ve seen this phenomenon play out in microcosm. As a result of this growth and the overall changing dynamics of the industry, credit union leaders are shifting their strategic priorities. Here are some of the top concerns I’m hearing from the ground.

1. Regulatory Engagement & Advocacy

Risk mitigation is always a top priority among credit unions. But as both the market and individual organizations grow, the amount of risk these companies assume grows to match. In response, credit union leaders I’m talking to are working to enact smart policies and processes to keep up evolving economic and compliance challenges, while at the same time maintaining their cooperative mission and sustainable member service. This often looks like the following:

• Implementing clear rules to help to avoid undue burden from regulators like the Consumer Financial Protection Bureau (CFPB) and the National Credit Union Administration (NCUA)
• Increasing board and CEO policy fluency to open up dialogue with regulators and improve understanding
• Aligning operations, risk management, and member outcomes to adapt proactively and maintain compliance

2. Member-Centric Financial Services Innovation

Credit union members are increasingly demanding personal, simple, and accessible digital experiences across the various channels with which they engage: payments, lending, and service. However, legacy systems built to handle smaller customer bases can make the digital transformation needed to meet these demands difficult.

Although some credit union leaders are resistant to technological change, it’s also worth noting that there are truly innovative, forward-thinking leaders in the market. These leaders aren’t solely focused on meeting technical milestones, but measuring  progress against the member outcomes these technical advancements deliver.

Based on what I’m hearing, these leaders are guiding their organizations to:

• Adopt platforms that use predictive analytics to anticipate needs and personalize member services at scale
• Build integrations among various tools that maintain context across voice, chat, mobile, and branch touchpoints
• Implement seamless, intuitive self-service options that can escalate to human advisors when needed

3. Credit & Lending Flexibility

Although interest rates are starting to ease in 2025, they’re still high, and there’s no guarantee of future relief. As such, credit unions are working to prioritize flexible and creative lending strategies to keep capital flowing. This has resulted in several phenomena that all center around flexibility in credit and lending:

• Turning to short-term, variable, and secured lending options, such as favoring home equity loans over longer-term mortgages, to manage both liquidity and member expectations
• Working to expand lending capacity through a proposed bipartisan bill, the Increasing Credit Union Lending for Business Growth Act, to raise the exemption threshold for member business loans (MBLs) from $50,000 to $100,000, giving credit unions greater flexibility to support SMB growth
• Deploying risk-aware products like credit-builder loans, income-based repayment plans, and Buy Now, Pay Later offerings to balance borrower needs and institutional risk while maintaining relationships with financially strained members

4. Talent Acquisition and Leadership Development

As all three of these trends continue, there’s a growing recognition of the need for forward-looking, dynamic leadership. If, like most credit unions have historically been, you have a more conservative culture and haven’t prioritized innovation, odds are you don’t have a “two-deep” leadership bench to prepare you for the future.

This means credit union leaders in the Northeast are prioritizing the following areas:

• Building and maintaining detailed succession maps identifying critical leadership roles such as CFO, CRO, CIO, and CEO
• Cultivating cultures that reward adaptability and ongoing learning to retain and develop talent in a competitive labor market.
• Conducting quarterly slate reviews for successor candidates for C-suite positions, including external benchmarking to understand market compensation and skill trends

The Risks of Leaving These Areas Unaddressed

Each of these four areas is a major challenge that, when left unaddressed, exposes the organizations to significant business risk:

• Talent shortages and leadership gaps that present issues when it comes to continuity and execution, particularly for credit unions that haven’t historically been “ahead of the curve” on these issues
• Regulatory uncertainty is a primary concern as evolving compliance demands will increase operational burdens and costs
• Economic volatility (if it continues) directly impacts earnings stability and credit quality
• Cybersecurity and fraud risks that escalate alongside expanding digital footprints, which serve as a reminder that digital innovation comes with additional risks of its own

All of these risks occur in the face of intense competition that credit unions face from banks, fintechs, and each other. Speed, user experience, and pricing are important factors here. While the cooperative trust that credit unions typically bring to the table is an important differentiator, falling behind in digital innovation and customer experience may erode membership growth and retention if not addressed proactively.

Talent & Succession: Closing the Readiness Gap

The credit union landscape in the Northeast is shifting fast. From boardrooms to branch networks, the leaders who will succeed are those who balance risk and innovation, and who can see around corners while staying rooted in their cooperative mission.

But recognizing the challenge is only half the battle. Closing the leadership readiness gap requires intentional talent strategies, succession planning, and the foresight to invest in the right people today for the demands of tomorrow.

At AJ Consultants, we see these dynamics play out every day. Our role is to help credit unions not just fill positions but find the right leaders: individuals who can navigate volatility, drive digital transformation, and strengthen the member-first ethos that sets credit unions apart.

If you’re in the Northeast and looking for a leader who can transform your credit union into a competitive force, I’ll help you find the right person. Let’s set up a time to talk.