More-conservative borrowers and stable real estate markets are among the reasons why Pennsylvania credit unions are experiencing member business lending growth.
Keystone Business Lending Solutions LLC, Member Business Financial Services LLC and the Pennsylvania Credit Union Association reported those findings in a white paper, “Building a Footprint for Solid Member Business Lending Practices.” The PCUA has a business services division.
Collectively, the report contains information focused on the 20 credit unions represented by the two CUSOs and PCUA with total assets ranging from $37 million to $1.1 billion.
The group had a combined MBL delinquency rate of 1.54% at the end of 2010, while the nation’s business lending credit unions averaged a higher delinquency rate of 3.76%, according to the data.
MBL growth has been “slow and steady and controlled” with the average loan size in 2010 at $186,580 compared with $200,810 for credit unions nationwide.
Some members of the group are near or up against their business lending cap and will often sell part of their loan interests to other credit unions.
The group attributes low MBL delinquency rates to more-conservative borrowers and lenders in Pennsylvania, a more state real estate market, consistent, sound business loan underwriting practices and proactive MBL portfolio monitoring.