By James Collins
If the NCUA’s proposed new net worth requirements are any indication, it would seem that our regulators feel that member business loans are about as desirable as a Florida time-share in hurricane season. Of course, the staggering number of credit unions that have failed—a grand total of four—probably overwhelms the number of credit unions that failed as a result of inadequate regulatory supervision—a number exceeding four.
That notwithstanding, by the end of 2013 credit unions had grown member business lending programs dramatically by $45.9 billion (an increase of 10.1 percent from 2012). Still, the demand for business loans continues to outstrip supply as evidenced by these approval rates:
Percentage of Small Business Loans Approved
Large Banks 20.0%
Small Banks 51.4%
Credit Unions 43.7%
Alternate Lenders 63.2%
Brother in-law George 00.0%*
*Source: Biz2Credit, July 8th, 2014 (except for George who told me to get a real job and “quit begging for a handout.”)
So who are these “alternate lenders”? And, why does George think my job is unworthy of consideration?