Loan Participation Reg Date Looms
With the effective date of the revised loan participation rule less than one week away, credit unions and CUSOs have taken another look at their lending programs to see if any adjustments need to be made.
At its June 20 meeting, the NCUA Board approved several revisions to the rule, including limiting purchasing credit unions to a single-originator concentration of $5 million or 100% of net worth, whichever is greater.
Credit unions who say they are interested in loan participationsare provided with a draft outline. Since its debut earlier this year, Hamilton said there has been strong interest in Catalyst Corporate’s loan participation facilitation program, especially on the buyer’s side, due in large part to credit unions having excess liquidity.
Diversification is key for clients of Willow Capital Group, a Centerbrook, Conn.-based firm that provides commercial loan origination, underwriting and closing for more than 30 credit unions managing a servicing portfolio of nearly $350 million. William McCluskey, CEO of the firm, said in preparation for the Sept. 23 effective date, the company evaluated all lead lender concentration limits.