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Rochester paper highlights CUs MBLs support
ROCHESTER, N.Y. (5/26/10)--A Rochester, N.Y., newspaper highlighted New York credit unions’ member business lending (MBL) and noted support by some of the state’s legislators for increasing the MBL cap for credit unions. For nearly 100 years, credit unions have provided business lending and business services, Michael Lanotte, senior vice president and general counsel for the Credit Union Association of New York, told the Rochester Business Journal Friday. “Credit unions have been providing business lending and business services to their members who own small businesses,” Lanotte told the Journal. “They were able to meet those needs unimpeded, in a very safe and sound manner for the better part of close to 80 years.” However, a change in a federal law in the late 1990s capped the percentage of total assets a credit union could use for business lending at 12.25% , Lanotte told the Journal. Credit unions’ business lending may be more prevalent than people perceive, Lanotte told the publication. “Typically, a credit union business loan is a very small number, an average of $200,000,” he added. “Credit unions maybe aren’t classifying these types of loans as truly business loans because they’re so small. They’ll go in as a secured personal loan. “Credit unions, although [the loans] might be on the books as business loans, are really doing a lot of small-business loan help for their members,” Lanotte continued. “Others, honestly, probably haven’t gotten involved much lately simply because of this artificial cap.” U.S. Sens. Charles Schumer (D-New York) and Kirsten Gillibrand (D-New York) are co-sponsors of a job creation bill in the U.S. Senate that includes legislation to raise the MBL cap to 25%, the Journal said. The publication also noted the efforts of several New York credit unions to provide member MBL, including: ESL FCU, Rochester; Reliant Community FCU, Sodus; Family First of New York FCU, Penfield; Olean (N.Y.) Area FCU, The Summit FCU, Rochester, and Syracuse (N.Y.) FCU.
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