As Congress considers lifting the arbitrary cap on the amount of money that local credit unions are allowed to lend to business-owning members, the cooperative financial services community is preparing to serve a new class of underserved customers: small businesses.
For some credit unions, preparation for increased commercial lending will be delivered by The Business Lending School, a new credit-union specific academy located in Federal Way that teaches credit union staff to effectively and safely underwrite business credit requests, and to satisfy state and federal regulatory expectations for their business lending activities.
“It’s no secret that banks have pulled back credit lines to small business since the financial collapse of 2008 and 2009,” said Washington State Credit Union League President and CEO John Annaloro. “The state’s credit unions are fully capable of supporting member-owned businesses and filling the commercial lending gap left by banks.”
Drawing from top-tier educators, The Business Lending School’s faculty has more than 30 years experience and has trained more than 25,000 individuals, from bank commercial lending staff to state and federal regulators.
In fact, The Business Lending School may offer the most academically rigorous training for credit union professionals in the western United States.
“The Business Lending School is formatted around five weeks of instruction, which allows a complete and immersive experience,” said Annaloro. “In addition, the school’s mentor program partners each student with a senior team member from their credit union who oversees the institution’s review of business lending and supervises risk administration. That mentor also helps guides the student on their academic path to fully meet the holistic needs of each institution.”
The school’s curriculum includes:
Mastering Accounting Practices for Various Business Types;
Unraveling the Financial Statement and Tax Return, and Cash-Flow Analysis;
Analyzing Business and Personal Financial Statements;
Developing Financial Projections for Credit Worthiness Determinations;
Developing Credit Administration Policies and Procedures; and
Analyzing Commercial Real Estate Credit Requests and Reviewing Commercial Real Estate Appraisals.
The first course begins April 5, followed by mentor training and additional courses occurring over one week increments throughout the spring and summer. Graduation is set for Oct. 8, 2010.
Visit the Business Lending School’s website for more information, including registration and contact information, at www.thebusinesslendingschool.com.
If the 12.25 percent of assets allowed for credit union member business lending is raised to 25 percent, it would open the way for credit unions to become much more active in business lending, at least to its own members.
Nationally, the raising of that lending lid would provide credit unions with the potential to create over 108,000 jobs and inject $10 billion into the economy with the passage of H.R. 3380 or S. 2919 with a dime of cost to American taxpayers.
Credit union leaders claim that banks are “working aggressively to halt the passage of this legislation and making outrageous claims to prevent credit unions from creating main street jobs” as well as visiting Capitol Hill with the top priority of defeating H.R. 3380 and its similar Senate bill, S. 2919.
Also, the Promoting Lending to America’s Small Businesses Act would also raise the threshold for a loan to be considered a member business loan to $250,000 — even though the national average member business loan is about $200,000.
Also, the new legislation would exempt financial loans made to non-profit religious organizations, as well as loans made in qualified underserved areas.
The Senate bill features the former provision, but not the latter, leaving issues to be resolved in Congress.
Talk to us
> Give us your news tips.
> Send us a letter to the editor.
> More Herald contact information.
