Friday, March 04, 2011 11:30:00 AM
WASHINGTON - Addressing a CUNA 2011 Governmental Affairs Conference (GAC) audience, Sen. Mark Udall announced the release of a bipartisan letter stating his intention to introduce legislation this year that would increase credit union member business lending (MBL) authority.
The letter, co-signed by Udall (D-Colo.), Sen. Olympia Snowe (R-Maine), and Sen. Charles Schumer (D-N.Y.), describes the Small Business Lending Enhancement Act, which would allow credit unions to increase their small business lending to 27.5% of assets from the current limit of 12.25%.
The bill states that to go above 12.25% for MBLs, a credit union must be well capitalized and have a history of MBL experience, be near the lower cap for one year prior to exceeding it, and receive approval by NCUA to lend in excess of the old cap. After a higher limit is approved, if the credit union's net worth drops below 7%, it must halt further member business lending.
At the GAC and in the letter, Udall restated CUNA's position that the MBL limit increase would inject an expected $10 billion into the U.S. economy and create an estimated 100,000 jobs.
"We've worked this out," he said. "It makes sense. We ought to put it into law. We came very close last year."
The Obama Administration last year said it supports increasing the credit union MBL cap.