Only a small number of community banks are reporting that they consider credit unions to be their chief competitors for business loans. Instead, most community banks named other community banks as their primary rivals.
In a survey conducted by the American Bankers Association, 4% of community banks (those with less than $1 billion) named credit unions as their No. 1 competitor for business loans. A plurality of banks (47.6%) instead named other banks as the institutions with which they are most likely to battle. Thirty-seven percent said large banks were their biggest competition, meaning 84.6% of respondents overall cited bank competition first.
Also receiving mention: government-direct lenders (6.7%) and non-bank firms (5.1%). Credit unions also received scant mention when community banks were asked to name their primary competition for business deposits.
Sixty-nine percent of the banks surveyed said they are feeling pressure in pricing their loans, up from 67% in the same survey in 1999.