The CEOs of two rural credit unions explained to lawmakers today how they have been helping their members through difficult times and said they could do even more if Congress would let them make more business loans.
"Small credit union operators believe the regulatory scrutiny they face is consistent with both their exemplary behavior in the marketplace and with the nearly imperceptible financial exposure they represent," Frank Michael, president/CEO of Allied Credit Union in Stockton, California told the Senate Banking Committee's Subcommittee on Financial Institutions.
Michael, who told the panel that there are about 1,500 credit unions with assets of totaling $60 billion headquartered in rural areas and more than half of them have five or fewer employees, said they should be allowed to make more business loans . He also told the panel that as Congress looks at ways to revamp financial regulations, they should give small credit unions relief from some regulations.
Ed Templeton, president/CEO of SRP Federal Credit Union in North Augusta, South Carolina, urged lawmakers to lift the cap on member business loans, which is now 12.25% of total assets.
"Many credit unions have the capital that other lenders do not in this environment, but are hamstrung by such an arbitrary limitation," he said.
Templeton also asked Congress to change the law to allow community and single-sponsor federal credit unions to add underserved areas to their field of membership. The NCUA had banned that practice following a lawsuit by the American Bankers Association.
Michael testified on behalf of CUNA and Templeton testified on behalf of NAFCU.