Thank you for sharing!

Your article was successfully shared with the contacts you provided.

<p>WASHINGTON – CUNA’s John McKechnie, vice president, legislative affairs, and Mary Dunn, senior vice president, associate general counsel for regulatory advocacy met with Executive Director John Whitmore and Acting Associate Deputy Administrator Jeanne Sclator from the Small Business Administration January 15 to provide the SBA with solutions that will allow credit unions to participate in SBA programs. NAFCU officials had a similar meeting with SBA Director Hector Barreto recently to discuss federal credit unions’ options for making SBA-backed loans (CU Times, Jan. 16). The sticky point, said McKechnie is the SBA’s position that small business loans are meant to be used for things that are for the good of the general public. Because of credit unions’ field-of-membership restrictions, the SBA has argued that credit unions, except for those with community charters, do not serve the general public. That wasn’t always the SBA’s position, said McKechnie, and neither he nor Dunn were sure when or why the SBA reversed itself on permitting non-community chartered credit unions to participate in making SBA loans. What they do know – and conveyed to the SBA – is that “even though there are field-of-membership restrictions on credit unions and that credit unions cannot statutorily serve the general public, that even those credit unions without a community charter still have fields-of-memberships large enough to be considered serving the general public,” McKechnie said. Dunn said the issue has more to do with interpretation and any change would not require a statutory modification. “We are dealing with the interpretation of a statute, not a rule anyone was allowed to comment on.” “The SBA’s public policy goal is to make help easier for small business people in the U.S.,” said Dunn. “Minorities in small businesses are very underserved. Allowing credit unions to participate in the SBA program would be a way for the SBA to increase the availability of funds.” Dunn and McKechnie said the SBA is interested in credit unions being more involved with the program. They said Whitmore and Sclator were both well aware of banks’ attempts to keep credit unions out of the SBA programs and from servicing the underserved markets. “We talked very candidly with the SBA about this. We made a very forceful and direct case, and they said they were aware of the banks’ efforts,” said Dunn. “There is so much demand for SBA loans that goes unanswered, especially loans under $100,000. Credit unions would be perfect for these types of loans,” said Dunn. Both CUNA officials said they were pleased with their meeting, “but we still have a lot of work to do to show them credit unions want to participate,” they said. “We want to have an actual roll-up-the sleeves work session with the SBA.” McKechnie and Dunn were invited by Whitmore to meet with SBA General Counsel Robert Gangwere since it’s his interpreation of SBA policy that is responsible for non-community chartered CUs being blocked SBA loan programs. CUNA is also planning to put together a panel discussion during the upcoming GAC on SBA lending and plans to invite SBA officials to sit on the panel. “Once more credit unions that aren’t community charters realize the SBA is welcoming their applications, then more credit unions will apply to be provide SBA-backed loans,” said Dunn.” -</p> <p>[email protected]</p>

Complete your profile to continue reading and get FREE access to CUTimes.com, part of your ALM digital membership.

Your access to unlimited CUTimes.com content isn’t changing.
Once you are an ALM digital member, you’ll receive:

  • Critical CUTimes.com information including comprehensive product and service provider listings via the Marketplace Directory, CU Careers, resources from industry leaders, webcasts, and breaking news, analysis and more with our informative Newsletters.
  • Exclusive discounts on ALM and CU Times events.
  • Access to other award-winning ALM websites including Law.com and GlobeSt.com.

Already have an account?


Credit Union Times

Join Credit Union Times

Don’t miss crucial strategic and tactical information necessary to run your institution and better serve your members. Join Credit Union Times now!

  • Free unlimited access to Credit Union Times' trusted and independent team of experts for extensive industry news, conference coverage, people features, statistical analysis, and regulation and technology updates.
  • Exclusive discounts on ALM and Credit Union Times events.
  • Access to other award-winning ALM websites including TreasuryandRisk.com and Law.com.

Already have an account? Sign In Now
Join Credit Union Times
Live Chat

Copyright © 2022 ALM Media Properties, LLC. All Rights Reserved.