It's no secret that Michigan has endured a struggling economythese past few years. Pressures first caused by the dot-com bust,followed by 9/11 and then the automotive industry challenges havetaken their toll on Michigan businesses and their employees. And,most recently, we've borne the cost of rising energy prices andinterest rates; the former primarily caused by growing globaldemand and the latter caused by a booming national economy. Thewhole world is partying and we're not invited.

So why did three new commercial CUSOs form and many creditunions launch new or expanded commercial lending efforts in themidst of this uncertainty? Because tough times often createopportunity. And because mission compels credit unions to serve theneeds of their members and communities while the rest of thefinance community slaves to their wealth creation mandates andredeploys capital to growth markets.

In the credit business, challenging economic times appropriatelyrequire lenders to take more conservative credit stances.Loan-to-values, debt service ratios, covenant requirements allbecome drivers of the credit decisioning process. Credit unions,like banks and other sources, need to do the same thing. Thedifference, however, is simple and significant. Most regional andnational lenders have one size fits all credit policies andpractices. They make wholesale declarations and galvanize them inthe form of policy and its application. In tough times, the creditbox gets smaller. Even very high quality borrowers with uniquesituations find it difficult to fit in. Credit policies authoredhundreds or thousands of miles away by people who will never meetthe customers they serve cannot possibly recognize the specificnuances of a particular community, project or borrower. It's notmuch of a problem for the very best borrower in the marketplace,but everyone else understands very quickly that there is littletheir local lender can do to influence the authority of the peoplewho sit on high floors in some distant town. With relatively fewexceptions, credit unions are THE local commercial lendingsolution. And with well-qualified staff or the help of a CUSO,commercial lending can be a huge competitive advantage and afoundation for growth in all lines of business. Credit unions workhard to fulfill their mission and are not conflicted by Wall Streetpressures. Mission is purpose, not statement, and good commercialborrowers are quick to notice the difference. But credit unions,like all lenders, must apply smart credit fundamentals and adjustthem for changing economic challenges. Mission, however, motivatesthem to leverage policy for the wisdom it provides, but makedecisions one member at a time. Nowhere is this more evident andimportant than in commercial lending. In the past two years,commercial CUSOs in Michigan have reviewed more than a quarterbillion dollars of new commercial loan opportunities and fundedmore than $100 million in new financing. Our credit unionsparticipate in credit enhancement programs like the SBA and theState's Small Business Capital Access program. We support Chambersof Commerce, sponsor educational programs and engage in communitybuilding efforts. Commercial lending, and the relationships itcreates, is a critical success factor for our mutual asset andincome growth.

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