That’s the offense … but is there a defensive strategy at play here as well? Anzalone explains. As a $2.0 billion credit union situated in the San Francisco Bay Area and Silicon Valley, Anzalone says it’s relatively easy to figure out the profile of many Tech CU members. He says, “Many of our members are either starting a business or growing a business. Some may be going through a turnaround.  If you don’t have a product like ABL, you’re vulnerable to competitors that are more than willing to step in and provide the kind of financing our members may need. That’s why, for an institution like ours, this product is absolutely necessary.

"Jeff and I have a shared understanding and an appreciation of how asset-based lending can support growing businesses.  With his skill and experience, I’m confident we’ll deliver an attractive commercial lending product to our membership while ensuring that our standards for credit quality will be achieved."

As Tech CU joins the ranks of asset-based lenders, ABL Advisor asked the executives to comment on the state of today’s marketplace. Johnson says, “I think that today’s ABL market is saturated, but there’s still room for Tech CU  to attract  quality business. Our goal is to serve the growing needs of our members, while emphasizing our desire to build long-term relationships."

Anzalone adds, “I think Jeff’s description nails it. But, I want to reiterate that we are going to do this correctly.  ABL operations can make a lot of money, but there is risk in this type of lending and it has to be managed correctly. There’s a lot of aggressive competition out there, but we’re not going after business just for the sake of growing our portfolio. We all have decades of experience in commercial lending. Within four years of launching our commercial lending division, Tech CU has originated approximately $220 million in aggregate commitments — before adding the ABL Division.  I’m proud to report, we have zero losses and zero past due loans. You can see that we come from a culture of understanding the value of doing good credit.”

Understandably, Johnson sees things similarly.  He says, “Our loan production office at BFI Finance had  negligible losses over a 20-year period. The way to succeed in ABL is by keeping your head down and doing things properly.”

For now, as it relates to this new player in the ABL space, Johnson and Noon are walking the talk and confident that the future will bring about expansion to their team. “We’ll seek out new talent to enhance what we already have at a later date. Right now, we’re focused on putting the right infrastructure and processes in place — building that strong foundation — and kicking things off.”

In closing, Anzalone also looks confidently to the future without losing site of the important attributes of credit unions. “For me, it comes back to our story of relationship banking. The credit union identity is built around that philosophy and, I believe, this is more important now as banking consolidation continues. Tech CU now bears the distinction of being the only credit union in the nation offering asset-based lending. With a full complement of products and services within a high-touch, relationship-based institution — these are exciting times for us.”