Royal CU task force gets go ahead to study CUSO possibilities

EAU CLAIRE, Wis. – A task force organized by Royal CU to study the feasibility of forming a member business lending CUSO has gotten the green light from the credit union’s board to conduct a study to look in to the market opportunity of running a member business lending CUSO and to explore the types of services the CUSO would provide. The group met in May to discuss the options and presented them to Royal CU’s Board. It will present the findings of its study at the credit union’s planning meeting in September. Royal CU has been involved with member business lending for 15 years. President/CEO Charles Grossklaus said the $575 million CU has gotten calls from other credit unions who are interested in offering the service but either don’t have the expertise to support providing MBL’s themselves or want guidance to set up their own program. Grossklaus said he knows there is a need for a member business lending CUSO, “But we don’t want to get into it unless we’re sure we can make enough loans to cover our costs and make something for our members. We won’t get into it unless it’s good for our members.” Royal CU will be looking, for example, into whether it would be better to participate MBLs out with other credit unions, or originate the loans and service them itself. The credit union will also be considering selling its expertise to other credit unions. “We don’t know what we’re allowed to do as a credit union under the state’s member business lending rule, so we’re going to have to look at that more closely as well,” said Grossklaus.