CUNA to Administration: Where Do CUs Fit In?

by Ron Daly 

For the past few weeks, CUNA has been striking out at the Obama Administration's new Small Business Lending Fund plan. The plan, which would distribute $30 billion in unused TARP funds to 8,000 community banks, doesn't mention credit unions as a potential business lender or alternative to community banks. 

From the above Fox News story:

Senior administration officials say the Treasury Department, SBA (Small Business Administration) and other White House officials and community bank groups worked on this legislation together and will affect banks that have between one billion and 10 billion dollars in assets.

CUNA, upon hearing the details of the President's plan, registered its outrage in a series of posts and stories on its website and in the CU Times. CUNA President and CEO Dan Mica registered his disappointment with further bank investments and is asking for face time with President Obama to speak on behalf of CUs across the country.

From CUNA News Now: 

"Credit unions have been making loans over the past year and can make even more if legislation expanding their capacity to make small business loans is enacted. I hear credit unions say: 'Don't just subsidize the banks; let us help this country get back on its feet--without using taxpayers' money,'" [Mica] added.

Business lending caps have been a hot topic for credit unions in the past year. A recent Washington Post article about CU business lending has this quote from a Treasury rep about bringing CUs into the fold: 

"We work very closely with credit unions and we have put forward a number of initiatives to help small businesses, but we are always willing to explore new ideas," Andrew Williams, a spokesman for the Treasury Department, said Monday.

We're eager to hear your opinion about the Small Business Lending Fund. If the business cap needs to be lifted, or increased, are the ramifications going to be so dire for banks? And what if the cap ISN'T lifted? Credit Unions nationwide have been doing more to lend to businesses with their own money. Do we really want to get in on the bonanza of $30 billion in TARP leftovers, or just keep up our "thanks but no thanks" attitude and lend to businesses as much as we possibly can without the cap disappearing?

Tell us your thoughts in the comment section.

Comments

[Mark McCormick]

I have always believed in free competition; such as no caps on any lending or lending rate caps.

I also do not believe that credit unions should be tax exempt. We are supposed to be non profit. What's wrong with paying into the pot if you earn a profit (just as banks do)?
mrm

[Denny DeGroote]

I am continually amazed that our would be leaders are so blind to the answers that are staring them in the face.
Credit unions have always been here, helping members (consumers) make their way fiancially. We are the right solution (one of them) for a time like this.
I think our leaders are either stricken with Washingtonitis or they are beholden to .....someone-maybe Wall Street?!?
Whichever it is, Main Street gets stuck with the bill!