ST. PAUL, Minn. (2/14/12)--Minnesota credit unions increased their small-business lending in the fourth quarter 2011 amid stagnant bank lending, according to a column written by the Minnesota Credit Union Network (MnCUN), which was published in an area business newspaper.
In a Finance & Commerce column titled, "Association Update: Credit unions prepared to boost lending in 2012," Mark Cummins, MnCUN president/CEO, contrasted credit unions' willingness to help small businesses with that of banks.
"Despite the need for businesses to grow, a Finance & Commerce article last week highlighted that bank lending stalled in the fourth quarter," Cummins wrote. "With the headline 'Lending goes nowhere in Q4,' the article stated that 'the obstacle to new loans remains largely about weak demand.' Even so, many credit unions have experienced the opposite, citing increased demand. Perhaps this issue deserves a second look.
"Credit unions are eager to increase their efforts to help Minnesota's small businesses obtain funds," he continued. "Minnesota credit unions' business lending activity increased by nearly 3% over the past quarter and 8% over the past year. They would like to increase their lending even more but are prevented from doing so by a cap that limits member business lending (MBL) activities to 12.25% of assets."
Credit unions nationwide have millions of dollars they could lend to job creators if Congress would repeal the regulations that prevent them from lending that money out, Cummins wrote.
"America's small businesses are the engine of growth for our nation's economy. Today, small businesses need more options, and credit unions are in a position to help," he concluded.
The Credit Union National Association (CUNA) and credit unions are pressing Congress to increase credit unions' MBL cap to 27.5% of assets from 12.25%. Doing so would open up more opportunity to offer MBLs, inject $13 billion in loans into the economy and create as many as 140,000 new jobs, with no cost to taxpayers, CUNA said.
CUNA also sponsored a Small Business Hike the Hill event last week in Washington, D.C., in support of the MBL increase.
To read the column, use the link.