Mike London

Lending opportunities and challenges

Georgia United Credit Union’s Michael London offers his lending outlook for 2019.

November 1, 2018

Michael London expects strong loan growth in 2019 for $1.3 billion asset Georgia United Credit Union, where he serves as chief lending officer.

But London, CUNA Lending Council Conference executive committee chair, also expects growth to slow relative to the pace of the last few years.

“We see a few things affecting growth,” London says. “For starters, we’re in a rising-rate environment for the first time in a decade. This affects borrowers’ ability to afford credit and acts as a psychological barrier as our member have to adjust to seeing higher rates.”

In Georgia, the credit union also sees an inventory shortage affecting the local housing market. “Many members are applying for mortgages but are unable to find a home to purchase,” he says.

In a Q&A with CUNA News, London elaborates on his outlook for lending in 2019.

CUNA News: What lending bright spots to do you see in your market?

London: Home values have rebounded in Atlanta and home equity lending has been, and should continue to be, an area of growth for us.

We’ve also been very intentional in our efforts to grow our credit card portfolio in recent years. Those strategies are paying off, and we expect to continue to see strong growth in that area.

Additionally, I think there continues to be opportunity in the direct auto lending space. Many banks are pulling back from that asset class to focus on other areas.

CUNA News: What are some of your top lending challenges, and how do you plan to address them?

London: As rates rise and margins compress, indirect auto lending will be a challenge. We are actively managing our rates and dealer compensation to make sure we are operating profitability in this space, even if it means slower growth.

Another top challenge in the lending arena is the continuing battle to make sure our technology is up-to-date and producing excellent member experiences. We are working hard to develop capabilities that enable us to be nimble integrators of technology to prevent our delivery channels from becoming outdated.

CUNA News: What advice can you offer other credit union lenders about succeeding in 2019?

London: Make sure you are using the data assets available to you, internally and externally, to understand who your members are, how they are interacting with you, and what products they need.

This will help you understand and overcome the unique challenges within your organization and loan portfolios.