BEAVERTON, Ore. and FEDERAL WAY, Wash. (9/18/12)--During the past 12 months, Oregon and Washington's credit unions have increased member business lending by 11%, infusing $235 million into the region's economy, according to the Northwest Credit Union Association (NWCUA).
MBL totals have increased 7.96% in Oregon and 13.1% in Washington.
The Northwest's financial cooperatives have more than $2.3 billion--$810 million in Oregon, $1.5 billion in Washington--in outstanding MBLs as of June 31 (Anthem Recap Sept. 17)
For quarter-over-quarter, MBLs rose 2% in Oregon and 2.8% in Washington. Credit unions nationwide experienced a 1.2% increase during 2012's second quarter, according to the NCUA.
"Credit unions in the Northwest and nationwide are filling an important societal need left when banks began exiting the business lending market after 2008, when business lending at banks reached a peak," said NWCUA CEO John Annaloro. "The divergent tracks of the for-profit versus not-for-profit banking sectors in this market in some ways have become less of a balance sheet issue and more of a patriotism issue."
Despite the need for more business lending, banks instead are buying U.S. Treasuries and have increased their holding to an all-time high of $1.84 trillion, according to a report by the Small Business Administration entitled "The Increasing Importance of Credit Unions in Small Business Lending." Banks have purchased $136.4 billion in T-Bills and government debt so far in 2012--more than double the $62.6 billion purchased in all of 2011, said the report cited by the NWCUA.
The Credit Union National Association (CUNA) and credit unions are urging 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 business loans into the economy and create as many as 140,000 new jobs, with no cost to taxpayers, CUNA said.