CUNA and NAFCU are urging members of the House Financial Services to approve an amendment that would essentially exempt all credit unions from having to contribute to a proposed Stabilization Resolution Fund.
The amendment, which is sponsored by Rep. Brad Sherman (D-Calif.), would only assess financial institutions with assets of $75 billion to pay for the fund, which is aimed at rescuing large companies considered too big to fail. The panel is marking up the legislation and could consider Sherman's amendment as early as today.
The bill as currently written makes financial institutions with more than $10 billion in assets liable for having to pay for the fund, which would be administered by the FDIC. Three credit unions would be subject to these payments: Navy Federal Credit Union, Pentagon Federal Credit Union and State Employees Credit Union.
"It is unacceptable that the members of any credit union would be asked to fund a resolution fund for failed for-profit companies. It is structurally impossible for a credit union to be part of any such holding company, so credit unions fall totally outside of the conceptual concerns to be addressed by the bill," CUNA President/CEO Dan Mica wrote committee members.
NAFCU President/CEO Fred Becker expressed similar concerns.
"Imposing such a cost on not-for-profit cooperatives (such as credit unions) and their members would essentially amount to a new tax on members of these institutions, while entities covered by the Fund could simply cover the cost of the assessments through their shareholders," he wrote.
