X

Thank you for sharing!

Your article was successfully shared with the contacts you provided.

WASHINGTON – Business lending at credit unions has a safer track record compared to banks and thrifts, according to a U.S. Treasury Department study. The study found that member business loans are generally less risky than commercial loans made by banks and thrifts because they generally require the personal guarantee of the borrower and the loans generally must be fully collateralized. Ongoing delinquencies – for credit unions, loans more than 60 days past due, and for banks and thrifts, loans more than 90 days past due – are lower for CUs than for banks and thrifts, the study showed. Credit unions’ mid-year 2000 loan charge-off rate of 0.03% was much lower than that for either commercial banks (0.60%) or savings institutions (0.58%). Treasury also found that member business lending “does not pose material risk” to the National Credit Union Share Insurance Fund. From 2000 to 2003, MBL net charge-offs averaged 0.08% at credit unions while the rate at commercial banks was 1.28% and 1.11% at savings institutions.

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.