FORT LAUDERDALE, Fla.-Was 2008 a tough year when it came to lending? One person doesn't expect early 2009 to offer much relief.
Lloyd Gill, EVP and chief lending officer of City CU, and chair of the CUNA Lending Council, predicts the first half of 2009 will be "difficult." "Retail spending will be down for the holidays in 2008," he explained. "So after the holidays, we will see bankruptcy and unemployment." Gill said the second half of the year could be better, but it's no certainty.
"Be prepared for high delinquency and charge-offs," he said. Members may seek home equity loans, equity consolidations and auto refinancing-if the equity is there, Gill said.
Gill noted that credit unions can also expect to see many more members with first-time problems. "We need to have some products that can help those people," he said. "We need to focus on refinancing, and helping people. Some aren't aware they can get credit. These are people who did good all their lives, and now have problems."
Gill noted that South Florida has been really impacted by the economic turmoil, and therefore City Credit Union is heavy in risk-based pricing in its loan products.
"Other areas are saying that business is as usual," he said.
