Great Basin Federal Credit Union of Reno has won approval to begin making commercial loans guaranteed by the federal Small Business Administration.
The SBA’s approval of the application from Great Basin Federal Credit Union marks the first new Reno-based SBA lender in at least nine years, says David Leonard, manager of the SBA’s Reno branch.
Jennifer Denoo, chief operations officer of the credit union with $125 million in assets, said Great Basin looks to business lending as a way of opening new markets to get loans onto its book.
“We are getting into this at the right time,” she said, noting that demand for business loans is picking up as the northern Nevada economy continues to recover. “Our community needs this now more than ever.”
Denoo said, too, Great Basin’s leaders view lending to small businesses as another way to extend its services to its membership of people who live, work, worship or do business in Washoe County.
She said the credit union will target business loans ranging from $50,000 to $500,000.
“We have a lot of members who are small business owners,” Denoo says. Other potential borrowers can become members of the credit union by opening a savings account.
Great Basin will make loans through SBA programs that provide real estate and equipment financing as well as those that finance the launch or expansion of a business.
Denoo said Great Basin expects to help its business borrowers with the same sorts of educational and counseling services that it has provided to consumers since it was founded in 1951.
Leonard said the credit union’s expertise with customer service was among the factors that led to approval of its application to become an SBA lender.
He noted that credit unions have been rare among SBA lenders, both because they typically are focused on consumer lending and because they usually face restrictions on the business loans they can carry in their portfolios.
Great Basin, which already has a couple of loans in its pipeline that might be SBA-guaranteed, has outsourced the back-office work of the commercial lending operation. Denoo said the credit union doesn’t expect to add staff immediately with the new program.
Leonard said the addition of a new SBA lender to the market improves the competitive environment for business borrowers.
And he noted that lenders generally bring their own expertise and market strategies to the business of making SBA loans. More providers will provide more approaches, he said.
