One of the most frequent questions I get from fellow credit union executives and board members is how to find new avenues for sustainable, strategic growth. In the latest episode of the Credit Unions Forum Podcast, I sat down with John Skeldon from CBS CUSO to dive deep into what I believe is our movement's biggest opportunity: business lending.
For many institutions, the shift toward commercial and SBA lending feels out of reach due to the high costs of infrastructure and specialized staffing. However, John and I discussed how the collaborative power of a CUSO allows credit unions of all sizes to compete with the "big guys" while maintaining a healthy balance sheet. We explored the mechanics of loan participations, the reality of risk management, and why keeping capital local is the ultimate win for our members.
Below, I've outlined the key subtopics from our discussion, along with a link to the full episode and a complete transcript of our conversation.
Strategic Takeaways for Credit Union Leaders
Strategic business lending isn't just about adding a new product line; it's about deepening member relationships and diversifying your portfolio. John shared several frameworks for how to approach this space effectively:
Yield & Diversification: Understanding how commercial and SBA lending provide a stronger yield and protect the credit union's balance sheet through portfolio diversification.
The Power of Collaboration: How smaller credit unions can leverage the shared expertise and infrastructure of a CUSO to manage compliance and underwriting without massive overhead.
Managing Risk Misconceptions: Addressing the "too risky" stigma by using proven management frameworks and loan participations to spread risk appropriately.
Local Economic Impact: The vital role credit unions play in supporting local small businesses and how that keeps jobs and capital within the community.
Greg Cook: Welcome to the Credit Unions Forum. I'm your host, Greg Cook, Credit Union President and CEO. Today, we're diving into one of the biggest strategic growth opportunities in the credit union movement: business lending. Joining me today is John Skeldon from CBS CUSO. Welcome, John.
John Skeldon: Greg, thanks for having me. I appreciate it.
Greg Cook: To start us off, why should credit unions be seriously considering business lending in today's environment?
John Skeldon: It's a great question. You mentioned it earlier: diversification. How can you diversify your balance sheet and offer your members a wide array of products? That's number one and number two—diversification and the availability of products for your members. Boards and leadership have to be behind it, and that's where an organization like CBS CUSO comes in. Credit unions are taking a leap of faith into something they historically haven't always done well on their own.
Greg Cook: I know many boards view business lending as "too risky." What misconceptions do you commonly hear from credit union leadership?
John Skeldon: Change is tough, and new things are scary. Historically, credit unions didn't have the expertise within their four walls to attack commercial lending at a meaningful level. That's why CUSOs were developed. We act as that shared back-office. We hire the experts so you don't have to build the entire system internally. It allows you to add this to your arsenal without the massive investment in tech and staffing.
Greg Cook: How can a credit union manage risk properly while still growing a healthy commercial portfolio?
John Skeldon: It's simple: take a small bite of a lot of deals. I don't expect a credit union of your size to take a $4 million piece of one loan. If that loan goes bad, it hurts. But if you take smaller chunks of many different loans, the sting is mitigated. We underwrite it, manage it through its life, and ensure it's done right.
Greg Cook: For a credit union with little to no experience in this space, what is the best way for them to get started?
John Skeldon: Use the community. Credit unions work so well together—you're "friendly competitors." Use that collaborative spirit. Reach out to a CUSO that's been doing this for 20-plus years. You don't need an entire team; you just need to plug into a model that already works and has the expertise in place.
Greg Cook: Looking ahead, what role do you see business lending playing in the growth of credit unions over the next few years?
John Skeldon: Credit unions are going to continue to get bigger and stronger. Commercial real estate isn't going away, and it's going to be an increasingly important offering for leaders to provide. We have to adapt to the fintech movement and the CUSO movement to stay competitive in the market.
Greg Cook: John, thank you for joining us and sharing these insights. It's a powerful path forward for our industry.
John Skeldon: I appreciate you having me on, Greg. Thank you.
Greg Cook: And thank you all for watching. We'll see you next time.
