Hope is fading for a CIT resolution. Although the New York-based bank is one of the nation's largest lenders to small and mid-sized businesses, CIT emerged from meetings with federal regulators failing to secure the cash infusion it needs to avoid bankruptcy.
However, small businesses have many options regarding financing and loan sources right in the their hometowns. CIT's competitors include larger commercial banks, such as Wells Fargo & Co. and Bank of America Corp.; General Electric Co.'s General Electric Capital Corp.; and some regional and community banks. Another source are credit unions.
The Credit Union National Association (CUNA), a trade association, said that nearly 2,200 credit unions (27 percent of the nation’s 8,000 credit unions) reported outstanding business loans at the end of 2008. larger credit unions are more likely to make business loans; over half (53 percent) of the 3,500 credit unions with more than $20 million in assets reported outstanding business loans at the end of 2008.
“Businesses must be aware that credit unions can only lend to their members,” explained CUNA VP of Communications, Patrick Keefe. “Credit unions have traditionally had products targeted to consumers. So business lending is a new growth area, although some credit unions have been making business loans since their inception.
The Independent Community Bankers of America represents 5,000 community banks of all sizes and charter types throughout the United States. In a recent interview on NBR, Chris Cole, Vice President, Senior Regulatory Counsel, assured businesses that community banks are a viable source for lending needs.
And there is the U S government itself. Programs are available through the U S Small Business Administration.