Since the start of the credit crisis, banks and thrifts havelost billions of dollars because of bad loans and problematicinvestments. The mortgage market turmoil has also contributed toconsiderable volatility on Wall Street and filtered into othereconomic sectors, from student loans to municipal borrowing. Mostrecently, this turbulence has resulted in a government takeover ofFannie Mae and Freddie Mac.

In contrast to most other participants in the financialmarketplace, credit unions have provided an important beacon oflight and stability during the last year. In fact, credit unionmortgage delinquencies stood at just 0.7% at the end of the firstquarter, well below the national averages of other lenders. Thecredit union movement can attribute this success to its cooperativephilosophy, which generally has and continues to produce soundlending practices and secure financial institutions.

By their very design, publicly traded financial institutionsoften fail to make their customers' interests their first priority.Instead, to maximize the gains for stockholders or increase thecompensation of their executives, for-profit lenders mightunderwrite riskier loans or pursue potentially troubling businessstrategies. The current mortgage crisis has caused many toreconsider this business model.

The cooperative nature of credit unions has so far helped themto avoid significant problems in the current financial turmoil.With a model where members look out for each other, credit unionshave generally maintained stable capital bases. They have alsoworked to continue to offer lower rates on loans, higher rates onsavings and fewer servicing fees.

Leaders in the Congress recognize the benefits of thecooperative credit union system. We have therefore worked on abipartisan basis to better regulate credit unions, improve theirefficiency and enhance their services.

More than a decade ago, the U.S. Supreme Court issued a rulingthat would have severely limited the freedom of individuals to joina credit union. Congress, however, took swift action to fix thisproblem. The Credit Union Membership Access Act of 1998--which Ijointly introduced and worked to enact--has permitted consumers tocontinue to join credit unions.

As a result of the enactment of this law, the size of the creditunion movement has grown by about 15 million members during thelast decade. The financial services marketplace, however, hasdramatically changed. To respond to these developments and allowcredit unions to better serve their members, the Congress needs toact once again.

Since 2003, I have worked to advance the bipartisan Credit UnionRegulatory Improvements Act, otherwise known as CURIA. This billwould improve the ability of credit unions to manage their risks,promote economic growth and satisfy their members' financial needs.In each Congress since its introduction, support for CURIA hasgrown, and we now have 150 cosponsors.

In order to strengthen the beacon of light provided by creditunions in the financial services world during these turbulenttimes, we have advanced some of CURIA's goals in recent months. Atmy request, this past March, the House Financial Services Committeeheld the first hearing focusing exclusively on credit union issuesin nearly four years. Moreover, I worked to introduce H.R. 6312,the Credit Union, Bank and Thrift Regulatory Relief Act, which theHouse passed by a unanimous voice vote in late June.

Like CURIA, CUBTRRA aims to expand the ability of credit unionsto promote economic development, underwrite more member businessloans and assist underserved communities. CUBTRRA also providesthrifts with greater lending flexibility and allows financialinstitutions to pay interest on business checking accounts.

Without question, CUBTRRA is the most significant piece ofcredit union legislation approved in the House during the lastdecade. Further reforms, however, are still needed, and I remaincommitted to enacting all of CURIA's provisions into law.

The swift passage of CUBTRRA in the House also proved an obviousbut often forgotten political rule. Namely, we can best achievesuccess by obtaining cooperation and compromise from all partiesinterested in the legislative process. Finding a workablecompromise between credit unions and banks going forward istherefore essential to passing comprehensive credit unionregulatory reform like all of the provisions found in CURIA.

The ongoing storm in our mortgage markets has forced manyfinancial institutions to scale back their activities, temporarilyhalt lending or even fold. Credit unions, armed with a cooperativephilosophy that puts members' interests first, have so farweathered the turbulence very well.

In short, credit unions have provided a beacon of financialsecurity by which individuals can navigate through this period ofmarket volatility. The stability provided by credit unions duringthis financial hurricane will only help to increase support for,and ultimately ensure the enactment of, CURIA when the watersrecede.

Rep. Paul E. Kanjorski (D-Pa.) serves as chairman of theHouse Financial Services Subcommittee on Capital Markets, Insuranceand Government Sponsored Enterprises. He can be reached at202-225-6511 or [email protected]