5 Mistakes Credit Unions Make in Business Services
With 34 years of experience in the credit union and commercial banking industries, Larry Middleman has seen what works and what doesn’t in the business services and lending spaces.
Middleman is founder of and president/CEO of CU Business Group LLC, a Portland, Ore.-based CUSO that provides commercial and business lending and deposit services to more than 400 credit unions in 45 states.
2. Not having the right resources and expertise in business deposit services.
3. Not completing annual business lending/service program reviews in a timely manner.
“When the examiner comes in and asks ‘what are you doing for risk management,’ you can get in over your head. Annual reviews need to be an important priority,” Middleman said. “They allow you to find out about business performance before problems happen.”
4. Not putting together a clear strategic plan.
“With senior management, if you put all the keys to the cars in the hands of the commercial lending officer just hired, bias may come through. It may take the credit union in a less than desirable direction,” Middleman said. “The plan should be written by senior management and reviewed and adopted by the board. It should have realistic growth projections.”
“Examiners are hammering on this. Going on the cheap is another pet peeve. Make sure you do proper due diligence on the lead lender,” Middleman said. “Look at the MBL staff, expertise, policies, level of depth and the type of loans you’re buying from them. What happens if the key person leaves? Is there a good backup?