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75 of Wisconsin voters polled support lifting MBL cap
PEWAUKEE, Wis. (8/23/10)--The majority of Wisconsin voters polled by the Wisconsin Credit Union League--75%--say they would support an amendment before Congress to make more credit available to Wisconsin companies through credit unions. An even larger majority of those polled--84%--say they’d be more likely to support the measure knowing it would create $389 million of new credit for Wisconsin firms, add 4,229 jobs in the state and cost taxpayers nothing. The league was referring to an amendment by U.S. Sen. Mark Udall (D-Colo.) to the Small Business Lending Fund Act, H.R. 5297, which is stalled in Congress. The Udall amendment would raise the cap on credit unions’ member business lending to 27.5% of assets from 12.25% of assets. Federal regulators support the measure, in part because of credit unions’ history of responsible business lending, said the league. As of March, the delinquency rate for Wisconsin credit union business loans was 2.23% compared with banks’ 2.77%. Credit unions’ loss rate--at 0.43%--was 30% lower than that of state banks, said the league. The measure would be a boon for small businesses with modest credit needs that find it difficult to find financing, the league said. Credit unions often will grant smaller loans. The average credit union business loan in Wisconsin is just $174,772. Most credit union business loans go to households with incomes below $50,000. The Wall Street Journal reported in March that bank lending has declined at the sharpest rate since 1942. In Wisconsin, banks’ business lending decreased 19% from March 2009 to March 2010. During that period, Wisconsin credit unions increased their business lending by 11%, but many have maxed out what they can lend to businesses because of the federal cap. Udall’s amendment mirrors legislative language sent to federal lawmakers by the Treasury earlier this year, and is backed by the Obama administration. The Credit Union National Association supports raising the cap.
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