Credit unions that maximize their business lending do a service to their communities as well as their bottom line.
Credit unions, while still a small percentage of business lenders, have a growing importance in business lending and can continue to promote local economic development by helping fund startups.
Vermont Credit Union ($330.1M, Burlington, VT), Melrose Credit Union ($1.5B, Briarwood, NY), and Mountain America Credit Union ($2.9B, West Jordan, UT) have all proven leaders in business lending from Sept. 2010 to Sept. 2011, according to the recently released Callahan & Associates 2012 Credit Union Directory.
Vermont Credit Union scored 1,302% growth in 12-month member business lending, the largest gain of any credit union in the past year; Melrose Credit Union was the top performing credit union with member business loans outstanding; and Mountain America Credit Union had the most Small Business Administration loans outstanding, Callahan data shows.
Obviously, if federal legislation introduced last spring allowing credit unions to lend even more to businesses passes, credit unions would have even more leverage to help their local communities. Currently, credit unions may lend up to 12.5% of their assets to businesses, but the new law proposes that cap be raised to 27.5% of their total assets.