Published March 2005

BECU rolls out
small-business services

By Kimberly Hilden
SCBJ Assistant Editor

As the largest credit union based in Washington state, with more than 390,000 members and $5 billion in assets, BECU already is an established force in the region’s consumer financial services sector. Now the nonprofit cooperative has its sights set on building a new market: that of the small-business customer.

Last March, the organization formerly known as Boeing Employees’ Credit Union began a pilot program for small-business services, offering deposit and loan products as well as merchant and payroll services at two of its express service center locations, in Seattle’s Greenwood neighborhood and in Puyallup.

The success of the program led BECU this past fall to expand its small-business services to all of its locations, including its financial center in Everett and its express service centers in Edmonds, Everett, Lake Stevens, Lynnwood and Marysville, said Arnie Gunderson, director of small-business services for BECU.

“We were very pleased with the results of our pilot program,” Gunderson said in announcing the service expansion in October. “The majority of our credit transactions have been for less than $100,000, which is a market that we believe has been underserved by the traditional banks.

“For example, a business owner had been working with a major bank that was not very responsive because credit requests of $100,000 or less are considered unsecured lines of credit. We were able to provide a solution in one business day, enabling the business owner to quickly return his attention to running his business,” said Gunderson, a 19-year veteran of the financial service industry.

Along with its traditional lines of credit, term loans and commercial real estate loans, BECU has partnered with the U.S. Small Business Administration to offer both the 7(a) Loan Guaranty and the 504 Loan Program, the latter providing financing for businesses looking to expand or modernize through real estate, machinery or equipment purchases.

“We were the first credit union in the Seattle District to sign an agreement with the SBA,” Gunderson said during a February interview at BECU’s headquarters in Tukwila.

For the quarter ending Dec. 31, 2004, BECU ranked No. 7 in the number of SBA loans made in the agency’s Seattle District, Gunderson said. “Our goal is to be number five by the end of the SBA fiscal year.”

Since rolling out its small-business services, BECU has gained 1,700 small-business members with 3,500 accounts, he said. The division also has made 200 business loans — 30 of them SBA loans — totaling more than $10 million.

All of that growth has come from word-of-mouth, as the cooperative has yet to invest in an advertising campaign for its business services, said Todd Pietzsch, manager of business development for BECU.

“Right now we’re serving the pent-up demand with current members. All we’ve really done is let our current members know that this is available,” he said.

That demand has been growing for the past decade, Gunderson said, noting that BECU had been surveying its members on the prospect of offering business products for the past eight or nine years — even before membership expanded to include those who live, work, worship or attend school in a Washington state school district.

At that time, the credit union’s entire membership was attached to the Boeing Co. in some way and had to deal with the boom-and-bust cycle inherent in the aerospace industry, Gunderson said.

“We had employees who were laid off and wanting to start a new venture, but up until this department was formed, we couldn’t serve them,” he said.

Today, the credit union can serve them as well as any other small business that is licensed in the state of Washington and becomes a member of the credit union, which requires the business owner to open a share savings account on behalf of the business, Gunderson said.

For more information on BECU’s small-business services, call 800-233-2328 or go online to www.becu.org.

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