WASHINGTON – July 12, 2011 – Credit unions are expanding to fill a void in business lending left by banks since the financial crisis. As banks have been slow to start lending again, credit unions have gotten a head start.
Banks still carry about 12 times as much in loans as credit unions in America, according to Federal Deposit Insurance Corp. statistics. But over the past two years, those numbers have trended in opposite directions, and officials at major credit unions say they are more interested than ever in commercial lending, not traditionally the core function of a credit union.
From March 2009 to March 2011, total loans by banks declined by more than $500 billion, according to FDIC data. Over the past year, credit union business lending is up 5 percent, while bank business lending is down 3 percent a decline of about $95 billion, according to the Credit Union National Association. Pat Keefe, a spokesman for the association, said credit unions are pushing into business lending in part because of slow demand for consumer credit auto and home loans, for instance.
“Businesses are looking for new sources of credit; credit unions are looking for new sources of borrowers,” he said. “They’re improvising strategies to do business lending.”
Source: www.floridarealtors.org
Copyright © 2011 USA TODAY, a division of Gannett Co. Inc., Adam Belz, USA TODAY. Belz also reports for the Des Moines Register.
