Credit unions are nonprofit organizations that benefit from tax exemptions and not having to comply with a number of banking regulations, including CRA and FDIC coverage. (Most, but not all, CUs are covered by NCUSIF.)
Due to their community charters and nonprofit statuses, CUs have regulatory and statutory limits to the amount of business loans they can hand out (12% of total loan portfolio, with loans up to $50,000 or SBA-backed loans not counting against the cap). Bankers and smaller credit unions argue, I believe reasonably, that increasing commercial portfolios by CUs would create an unfair playing field (the bankers' argument) and increase CU accountholders' risks (the smaller CUs, which generally aren't going for large commercial portfolios and see this as a way for the largest CUs to reduce the smaller competition).
Lending restrictions on CUs work well -- post-2008, credit unions were considerably more stable than commercial banks, with the exception of CUs that took on outsized commercial portfolios. For example, Texans Credit Union had a waiver that allowed up to 20% of its portfolio to be commercial (and then bought a subsidiary that had billions of dollars in CRE loans that didn't count towards its cap). Even before the crash, its bad debt ate up a majority of its equity, and consumed the rest in the 2008 meltdown. As a result, the board and executive leadership were summarily canned in 2011, after three years of steady deterioration, and the NCUA took over running the institution.
Due to their community charters and nonprofit statuses, CUs have regulatory and statutory limits to the amount of business loans they can hand out (12% of total loan portfolio, with loans up to $50,000 or SBA-backed loans not counting against the cap). Bankers and smaller credit unions argue, I believe reasonably, that increasing commercial portfolios by CUs would create an unfair playing field (the bankers' argument) and increase CU accountholders' risks (the smaller CUs, which generally aren't going for large commercial portfolios and see this as a way for the largest CUs to reduce the smaller competition).
Lending restrictions on CUs work well -- post-2008, credit unions were considerably more stable than commercial banks, with the exception of CUs that took on outsized commercial portfolios. For example, Texans Credit Union had a waiver that allowed up to 20% of its portfolio to be commercial (and then bought a subsidiary that had billions of dollars in CRE loans that didn't count towards its cap). Even before the crash, its bad debt ate up a majority of its equity, and consumed the rest in the 2008 meltdown. As a result, the board and executive leadership were summarily canned in 2011, after three years of steady deterioration, and the NCUA took over running the institution.