TROY, Mich. -- The growing entry of Michigan's credit unions into business lending in the midst of the state's tough economy was recently in the spotlight.
An article in today's Oakland Business Review mentioned a number of credit unions and CUSOs that are building their business lending programs. The $229 million Michigan Catholic CU has increased its business lending 200% over the past couple of years to $12 million through an alliance with Commercial Alliance, a CUSO, the publication reported.
The $184 million MidWest Financial's partnership with Michigan Business Connection, LC has helped the credit union to secure deals like the recent $12 million one for a cardiovascular surgery unit.
The article also mentioned the Credit Union Regulatory Improvements Act (H.R. 1537), which proposes raising the current 12.25% of assets member business lending cap to 20%. Despite Michigan's credit unions holding only 1% of commercial loans, many banks view CURIA's proposals as an "unfair advantage," the article noted. Dave Adams, president/CEO of the Michigan Credit Union League, said credit unions are not a threat to banks and "it's important to have a vibrant for-profit sector and also a nonprofit sector."
Besides offering business loans, some of Michigan's credit unions are merging for better market share and economies of scale, the publication reported.
