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Credit Committee/Loan Officer Duties and Responsibilities

The credit committee is usually elected by members at the annual general meeting (AGM) or appointed by the board of directors – and mostly made up of not less than three or more than five members. It also usually serves on a voluntary basis and reports to the membership or the board of directors, depending on whether they were elected or appointed.

This short guideline notes that in some countries there exists a clause in the bylaws that allows the credit committee to delegate the powers to loan officers. Since loan officers are experienced professionals they are able to grant more complex loans and the credit union can provide more complex loan products to the membership. The guideline argues that as credit unions grow the array of loan products offered, the use of professional loan officers instead of the credit committee is a good business decision.

The guideline separately sets out and describes the duties and responsibilities of loan officers and of credit committee.

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