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MBLs are rocket fuel of CUs says Virginia article
MADISON, Wis. (11/3/10)--More credit unions are seeking to fill the member business lending (MBL) void being created as banks cut back on lending, according to a Virginia business publication. “More retail credit unions--seeing an excellent, higher-margin niche in business loans--want to fill that lending vacuum, since most of their members have all but halted demand for the traditional consumer loans that have defined the industry since the first U.S. credit union was established by French-speaking Canadian immigrants to Manchester, N.H., in 1908,” said an article titled “‘Rocket fuel’ for credit unions” in virigniabusiness.com (Oct. 28). “They are paying down debts and salting away cash in case even tougher economic times are still ahead.” Demand for business loans in Virginia is strong as evidenced by MBL activity among the state’s credit unions, jumping 30% during a 12-month period ending last June 30, according to preliminary data from the Virginia Credit Union League, the publication said. “Business banking is the rocket fuel of the credit-union industry,” John Beiler, CEO of the Harrisonburg, Va.--based Park View FCU, told the publication. “I don’t advertise my business-lending program all that much; if I did [because of existing federal regulatory caps on business loans], I’d have to turn away about 99% of new customers.” The article also mentioned the University of Virginia Community CU in Charlottesville, Virginia CU in Richmond, and RF&P FCU in Richmond. After today’s elections, Congress will be back in session. The Credit Union National Association is continuing to work to get lawmakers to increase credit unions’ MBL cap to 27.5% of total assets from 12.25%. To read the article, use the link.
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