CanadaNews’ Reporter Notes

If you’ve ever had questions with credit unions, attending the CUNA’s annual conference will answer all of them.  The conference is being held at the Washington Convention Centre.  It’s a departure from their normal site, the Hilton Washington is DuPont.  The reason was simple:  more space.  The conference has been so popular that it had outgrown the  popular DuPont hotel.  They needed more room.

I’d actually advise you to have business to do at the conference rather than just showing up.  The Credit Union National Association will be holding their annual conference in Washington, D.C. this week.  The conference brings together those in the credit union business to discuss majour concerns within the industry.  One of the main concerns is the new bill  introduced in Congress yesterday.  California congressman Ed Royce (R) and Pennsylvania congressman Paul Kanjorski (D) both introduced a new credit union bill.  Specifically this bill would offer regulatory relief in 12 areas.  The negative side of the bill does not go as far as the Credit Union Regulatory Improvements Act (CURIA, H.R. 1537).  And this bothers many of those in attendance.

Oddly enough the bill was introduced just four days before a scheduled House Financial Services Committee hearing CURIA.  Some attendees find it strategically interesting.  “My first instinct was to ask why this bill wasn’t introduced earlier.  Congress seems to look at credit unions as second class citizens, and take us for granted,” said one attendee.

The new bill, the Credit Union Regulatory Relief Act (CURRA) of 2008, (H.R. 5519) touches on many areas of CURIA but does nothing to increase the credit union member business lending ceiling.  It also lacks in transforming prompt corrective action into a more risk-based system.

Dan Mica, Credit Union National Association (CUNA) President/CEO, responded Monday by saying, “We commend and thank Chairman Frank and Reps. Kanjorski and Royce for taking this bold step aimed at reducing the regulatory burden on credit unions.”  Mica added that “…more needs to be done.”

Borrowing from the CUNA the new CURRA bill would:

• Permit the purchase of investment grade securities by federal credit unions ;
• Increase the investment limit in credit union service organizations;
• Exclude from the member business lending cap any loans to nonprofit religious organizations;
• Allow the National Credit Union Administration (NCUA) to establish longer maturities for certain credit union loans;
• Give the NCUA greater flexibility in responding to market conditions;
• Permit, under certain circumstances, a federal credit union converting to a community charter to continue to serve groups outside the community;
• Enable credit union participation in the Small Business Administration’s 504 programs;
• Permit federal credit union to add service to underserved areas regardless of original field of membership;
• Permit federal credit unions to provide for short-term payday loan alternatives for nonmembers within a the credit union ‘ s field of membership;
• Permit a federal credit union to expel a member for cause, and to institute term limits for board members if it so chooses;
• Encourage small business development in underserved urban and rural communities by providing for the exclusion of member business loans made in underserved areas from the business lending cap ; and
• Provide an exemption from pre-merger notification of the Clayton Act.