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Converting to Federal Charter Helps Save CU's 75-Year Ag-Biz Lending Program

HUNTINGTON, Ind. - As a state-chartered credit union with a robust agricultural lending program, Community Link Federal Credit Union knew it was just a matter of time before new legislation would pull the reins back on its core loan program.

By Michelle A. Samaad | Updated on August 01, 2006

HUNTINGTON, Ind. – As a state-chartered credit union with a robust agricultural lending program, Community Link Federal Credit Union knew it was just a matter of time before new legislation would pull the reins back on its core loan program.

Last year Indiana bill HB 1179 updated the Indiana Credit Union Act to say total loans and extensions of credit at state-chartered credit unions cannot exceed 15% of the unimpaired capital and surplus of the credit union. For Community Link, that would have meant a $1.1 million reduction in borrowing limit to any one member. Previously state-chartered credit unions could loan up to 10% of assets to one borrower.

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