As CIT Group Inc., one of the nation's largest small business lenders, warns about a potential bankruptcy, Shoreline Credit Union is more concerned about what is happening in its own backyard.
CIT said today it expects to see a second quarter loss of more than $1.5 billion. After the federal government refused to offer bailout funds to the company, CIT's board approved a $3 billion emergency loan to help it continue to serve its more than one million small and medium-sized business customers. CIT said it may have to file for bankruptcy.
Meanwhile, the $97 million Shoreline CU is competing more with regional banks, said Kenneth Beine, president/CEO of the Two Rivers, Wis.-based credit union.
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"As banks started to pull back on credit last year, that ended up driving some people to credit unions. I suppose the same thing could happen here," Beine said on CIT's troubles.
Shoreline has an amicable relationship with some area banks. One referred the credit union to a local private high school. Shoreline has sent over loans deemed too big for the cooperative to handle, Beine said.
Beine said Shoreline has seen an increase in SBA loans, which now account for nearly $3 million of its $13 million business loan portfolio.
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