Commercial Loan Tools Give Big Boost To Volume

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Commercial loan tools were worth the wait for a credit union here with more than $60-million in member business loans outstanding.

Commercial loan servicing software gives Credit Union Central Falls (CUCF) loan officers "far more certainty that we can properly service our member business loan portfolio, which gives us confidence to solicit more commercial loan activity," said Fred Reinhardt, chief lending officer at the $1-billion CU.

Member business loans used to be boarded on a residential mortgage loan servicing system at the credit union, making a messy task out of the monitoring and reporting of the loans, according to Reinhardt.

CUCF launched the servicing system in tandem with origination software. Both systems are offered by small business loan processing and servicing provider PCFS 2000 of Brea, Calif.

PCFS 2000 was a long time coming, implemented last month after two years of research and testing with the CU's core processing vendor, said Lisa Dandeneau, CUCF's chief operating officer. "The PCFS system makes it easier for Credit Union Central Falls to offer revolving lines of credit to business members," Reinhardt continued.

Lines of credit are particularly attractive to business members, he continued. "These lines of credit are generally used for working capital purposes and are the lifeblood of all businesses."

Whereas business members can quickly get their hands on capital, auditors and regulators can get "assurances that the credit union is properly managing the inherent risks in its commercial loan portfolio," Reinhardt said. "The PCFS 2000 system helps us satisfy both demands."

PCFS 2000 includes SBA Form Wrx for origination, SBA Loan Manager for servicing, and SBA Desk Set for data-tracking and compliance, all of which can be used stand-alone or in unison.

However, the integration between the lending system and the CU's core system hasn't completely evolved. For example, CUCF is working to post commercial transactions in real-time by enhancing the interface between the two systems, explained Reinhardt.

Currently, posting to the core system is delayed about seven hours, he said.

Furthermore, Reinhardt looks forward to upgrades that will enhance non-SBA loans and commercial real estate loans.

"PCFS 2000 is currently developing a system specifically designed for the credit union industry that addresses some of these shortcomings," he added.

CUCF is the first credit union running the Summit core system to use PCFS 2000-and the pioneering effort presented its share of obstacles.

"We wanted to do an automated conversion of our loan portfolio from the old system to PCFS 2000," explained Dandeneau. "We expected to have a two-month 'live' beta testing period, but it actually took several months.

"We survived," she said. "Now, the commercial lending side is fabulous. Business is just walking in the door."

CUCF's portfolio holds more than 300 member business loans, said Reinhardt.

Meanwhile, the commercial accounts side needs some attention, Dandeneau continued. First on the list is a cash management module for business members that will automatically sweep funds from line-of-credit accounts to the member's other accounts, she said.

CUJ Resources

For info on this story:

* Credit Union Central Falls at

* PCFS 2000 at www.

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