LAS VEGAS – Three issues dominate the credit union lending space: a search for loan growth, portfolio problems and regulations.
That was the message from Aaron Bresko, VP of lending for Tukwila, Wash.-based BECU and chair of the CUNA Lending Council. Bresko said loan growth is one of the main topics at this year’s CLC conference, taking place here this week. “Consumer confidence is the No. 1 issue,” he said. “Credit unions have money to lend, but consumer demand is low and underwriting standards have gone up. The second-biggest problem is balancing loosening lending standards with safety. Several credit unions, BECU included, made changes three years ago. But now it is time to review performance and look at underwriting standards to look for opportunities while mitigating risk.”
Most CUs still have not gotten through the worst of their loan portfolio issues, Bresko noted. He said conditions are improving, but added some credit unions still have unrealized losses.
On the regulatory front, Bresko warned that several aspects of the Dodd-Frank financial reform bill passed by Congress in July are still unknown. “We are waiting for that shoe to drop,” he said. “In 2011 we don’t know what is coming, but we know there will be more impact on credit unions. There could an impact from the Dodd act, or there could be new consumer protection laws. The Lending Council’s regulatory committee is monitoring everything coming down the pike. That is our largest committee and we need every one of them.”
