While the rate of growth at credit unions is twice that of small banks, large bank lending to small businesses has been stagnant.
That’s according to the Texas Credit Union League, which cited data from the Biz2Credit Small Business Lending Index for February.
Over the past year, the largest institutions in the U.S. that received taxpayer assistance specifically to lend to small business only approve an average of 10% of the requests they receive, the league said. Credit unions approve more than 50% of their loan requests from small businesses, the data showed.
The league said from December 2007 through December 2011, banks scaled back lending to small businesses by nearly 15% while credit unions increased lending by 45%.
Dick Ensweiler, president/CEO of the Texas league, said credit unions in the state are urging Republican Sens. Kay Bailey Hutchinson and John Cornyn to vote for the Small Business Lending Enhancement Act.
The industry continues to push for a provision that would increase the member business lending cap from 12.25% of assets to 27.5%.