Wednesday, April 13, 2016

CUSOs Fuel Michigan CUs Business Lending Growth

Credit union service organizations (CUSOs) have played a key role in growing business lending at Michigan's credit unions, according to an article in Crain's Detroit Business.

The article notes that Ann Arbor-based Michigan Business Alliance (MBA), which is a CUSO, does underwriting and portfolio management on behalf of some 36 credit unions around the state. MBA started modestly, with a loan portfolio of $3.2 million at the end of 2004, and grew that to $423 million at the end of 2014 and $460 million at the end of last year. MBA stated that its commercial lending sweet spot are loans of $50,000 to $5 million.

Another CUSO, Troy-based Commercial Alliance LLC, has booked commercial loans of $46.3 million in 2011 and serviced a portfolio of $179.7 million. In 2015, it booked commercial loans of $156 million and serviced a portfolio of $388.7 million for 135 credit unions in the state. The CUSO has booked $39 million in loans with two weeks left in the first quarter.

The growth of commercial lending at CUSOs is a potential vulnerability for the credit union industry as the National Credit Union Administration does not have the power to examine third party service providers.

Read the story.

Posted by at
Labels: , ,

No comments:

Post a Comment

Subscribe to: Post Comments (Atom)
 

The content is provided for educational purposes only, with the understanding that neither the authors, contributors, nor the publishers of this site are engaged in rendering legal, accounting or other expert or professional services. If legal or other expert assistance is required, the services of a competent professional should be sought.

Comments appearing in response to articles appearing on this site do not necessarily reflect the views of the ABA. ABA makes no representations regarding the truth or accuracy of commentary or opinions that may be posted in response to the articles that appear on this website.

The inclusion herein of any link to a website, either in the text of an article or in a comment, does not denote any approval, sponsorship, or endorsement by the ABA, and ABA is not responsible for the content or opinions expressed on those linked websites or related commentary. This content is not licensed to third parties sites and is not affiliated with any third party site. Any reference to the author or this content on any third party site on the Internet is not authorized by the ABA.

It is the policy of the American Bankers Association to comply fully with all antitrust laws. Certain discussions should be considered off-limits, including those that contain competitively sensitive data such as price and cost information, or statements that could be construed as reflecting an attempt or desire to control or influence a particular market or markets. Future pricing or other prospective competitive information should never be shared.