Friday, July 31, 2009

Credit Unions Gone Wild

The Star Tribune has an excellent article, Credit Unions: Where the Credit Flowed Too Freely, on Minnesota credit union lending going wild.

Like co-eds on Spring Break, these credit unions engaged in riskier behavior.

These credit unions “pursued bigger, riskier and more elaborate loan deals in markets far removed from their everyday customers.”

As bankrupt real estate developer Richard Lewandowski told the Star Tribune, “one thing about credit unions, they didn’t ask many questions. Some of us in the development business, we’d sometimes smile about it … They were hungry to do a deal, any deal, if it meant they could get in on the real estate boom.”

I guess now many of these credit unions are waking up wondering was it worth the risk.
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