With the NCUA beating the drum even louder lately to increase the member business lending cap, the regulator is still aware of the troubled loan portfolios that have plagued some credit unions.
John McKechnie, NCUA director of public and congressional affairs, said the agency supports efforts currently underway in Congress to increase the MBL cap statutorily, in tandem with the gradual, incremental approach that includes additional regulatory safeguards. However, weaknesses in the commercial real estate market have led to increased supervision of business loans.
"Credit risk has been an area of emphasis for the past few years at NCUA and remains so. This includes all forms of loan products, including MBLs," McKechnie said. "We are not specifically targeting MBLs. Instead, any credit union showing signs of stress is receiving additional oversight from NCUA."
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