CUNA Calls for CU Letters to Congress re: MBL Support Posted by AVCU on 11:37 AM

As reported, U.S. House Financial Services Committee members Paul Kanjorski (D-Pa.) and Ed Royce (R-Calif.) introduced a credit union member business lending bill, Promoting Lending to America’s Small Businesses Act (H.R. 3380). The bill raises the cap on member business lending for FCU's from 12.25% of assets to 25%. This arbitrary cap was set by Congress in 1998. The bill would also raise the "de minimus" threshold for a loan to be considered a "member business loan" and exempt altogether loans made to non-profit religious organizations as well as in qualified underserved areas.

Although not the case for Vermont, many credit unions are up against the lending cap of 12.25% of assets. Others avoid getting involved due to the cap. The proposed change could inject up to $10 billion into the U.S. economy in just the first year, at no cost to the American taxpayer.

Vermont state charters are subject to limits similar to those currently applied to federals but by BISHCA regulation. Change in federal credit union limits doesn't automatically change state limits. Vermont law does allow credit unions to seek parity with federal if the commissioner so approves. So a change in federal limits may have indirect bearing on state charters as well.

CUNA is calling for credit unions to send a message to members of Congress today urging support for H.R. 3380 Do so easily by using CapWiz, where you can select components to include in your message and have it automatically sent to the appropriate member of Congress based on your zip code.