LANSING, Mich. (1/7/14)--Member business lending (MBL) at Michigan credit unions surged 18% through the third quarter of 2013, and state credit unions are well-positioned for future MBL growth, Dave Adams, Michigan Credit Union League president/CEO, told MiBiz.com
in a Jan. 5 article.
Since the end of 2009, business loans to members increased more than 85% for first nine months of last year, according to the most recent data available from the National Credit Union Administration.
The growth is the result of three factors: a slowdown in lending by banks due to the recession, strong liquidity among credit unions and a willingness by credit unions to diversify their portfolios by lending to local businesses, Adams told MiBiz.com
Credit unions offered loans to members who own and operate small businesses to diversify their balance sheets from residential mortgage and consumer lending, Adams said.
Grand Rapids-based $2.9 billion-asset Lake Michigan CU increased business loans during the first nine months of 2013 by 16% to $129.9 million, according to a quarterly report filed with the NCUA.
MBLs at St. Joseph-based $1.5 billion-asset United FCU rose by 62% to $157.2 million in the third quarter. Lansing-based $1.5 billion-asset Lake Trust CU increased its business loans to members by 37% to $110.4 million.
The Credit Union National Association is urging Congress to allow credit unions to play a larger role in helping small businesses through MBLs. The statutory cap on MBLs loans, as a proportion of credit union's assets, is currently 12.25%. CUNA says that raising the federal government-mandated ceiling to 27.5% would inject $13 billion into the economy, and help boost employment by 140,000 at no cost to taxpayers.
To read the full article, use the link.