NEW YORK—Small business lending approval rates at credit unions experienced a slight increase in May over the previous month, but overall CUs have been a relatively stagnant business lender over the last year, according to Biz2Credit.
Meanwhile, big banks ($10 billion+ in assets) and institutional lenders improved to new all-time highs, according to the Biz2Credit Small Business Lending Index for May 2015.
Credit unions approved 43.1% of loan applications in May, a slight improvement from 43% in April 2015.
"Credit unions have shown little momentum this year. They are still lagging in technological upgrades and hampered by the MBL cap that allows them to lend only 12.25% of their total assets,” said Biz2Credit CEO Rohit Arora.
Big banks approved 21.9% of small business loan requests in May 2015, up from 21.7% in April, marking the seventh consecutive month that approval rates have increased in this category of lenders. A year-to-year comparison shows that loan approval rates at big banks are up approximately 12%.
“Low interest rates continue to prevail. In fact, big banks are granting a higher percentage of small business loan requests than at any time since the recession,” said Arora, who oversaw the research. “Lending to businesses remains to be a profitable component of bank portfolios when the loan amounts are substantial. Thus, it is a good time to borrow. Conditions won't stay like this forever."