WASHINGTON (8/6/12)--With the day's economic news serving as a backdrop, Credit Union National Association (CUNA) President/CEO Bill Cheney discussed the financial state of the credit union system, and the push for job-creating member business lending (MBL) legislation on Bloomberg Radio's "Taking Stock with Pimm Fox."
Recent data suggest a slow, painful economic recovery for the nation, but Cheney said that credit unions continue to thrive. Credit union lending portfolios are improving, with lower chargeoff rates and steadily declining delinquency rates.
While demand for some loans has slowed, there is still demand for small business loans, and credit unions want to do more to help small business owners, he added. However, the MBL cap, which stands at 12.25% of total assets, remains a barrier to some.
The U.S. Congress could remedy this by approving legislation to increase the MBL cap to 27.5% of assets. Doing so would create 140,000 jobs and inject $13 billion in new funds into the economy in the first year following enactment, at no cost to taxpayers.
Overall, Cheney said, credit unions continue to gain market share because credit unions "are a better deal" for consumers. Credit unions have seen the strongest membership growth rate in 26 years, he said. Asked about federal deposit insurance for credit unions, Cheney explained that accounts insured by the National Credit Union Share Insurance Fund receive the same level of U.S. government guaranteed insurance backing, $250,000, as the Federal Deposit Insurance Corp. provides to bank accounts.