MELBOURNE, Fla. — Space Coast Credit Union's business lending program was touted in a Florida newspaper.
James and Sandy Haley have been members of the $1.5 billion Space Coast since 1988, according to a Sept. 26 article in the Daytona Beach News Journal. The Haleys said they have their personal accounts and previously had a mortgage with the credit union so when they saw a flier announcing that commercial loans were available, they applied and were approved for a $125,000 loan to expand their marine repair business.
Ed Cavaliere, a business service manager at one of Space Coast's branches, said consumers are both surprised and pleased to find their credit union can offer them that kind of help, the article read.
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"We have a very competitive program," Cavaliere told the publication.
Space Coast is not without its critics. The Florida Bankers Association said it "is among the 10 percent of credit unions that have overstepped their bounds, going beyond their original mission of providing financial services to small groups who might not be served by banks."
"Ninety percent of credit unions are fine. They are fulfilling their mission," said Alex Sanchez, president of FBA. "But, you got this new breed, these billion-dollar institutions, that are stepping into arenas formally home only to banks and crossing state lines."
Sanchez also pointed out the recent reports about the two credit unions in Colorado and one in Michigan tied to the construction loan losses in Florida. CUNA Spokeswoman Katye Long said she was not surprised that the banking industry would not be happy with that news, the publication reported.
"We don't unusually impress them anyway. For us, it is just being able to offer these services for our members," Long said, adding credit unions have been engaged in business lending for some time but it is just now coming to the forefront.
Cavaliere reminded the publication that credit unions have certain restrictions on business loans that banks don't have.
"As a credit union, the maximum amount that we can loan at this time is $2 million," he said, pointing out that one way around that is to partner with another credit union.
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