Credit unions will have to wait until next year to expand member business lending following yesterday's unsuccessful effort by Sen. Mark Udall to bring up the legislation in the waning days of the lame duck Congress.
Udall (D-Colo.) sought to bring up the measure through an expedited procedure known as unanimous consent. That allows any senator to object and Sen. Richard Shelby, the top Republican on the Senate Banking Committee, did.
"The bipartisan legislation that we should pass today will simply get government out of the way to allow credit unions to help jump-start the economy," Udall said in a floor statement.
Shelby (R-Ala.) didn't state the reason for his objection but he has often been critical of credit unions and at the panel's oversight hearing on the state of the industry asked NCUA Chairman Debbie Matz some pointed questions about how the agency has handled the examinations of some credit unions before they failed.
Udall's legislation would raise the cap on member business loans from 12.25% of assets to as much as 27.5% of assets.
CUNA and NAFCU expressed disappointment in the outcome.
"We will continue to advocate for raising the cap given small businesses' need for affordable capital and the nation's need for measures that will create jobs without imposing costs on taxpayers or swelling the federal deficit. This fight is far from over," CUNA President/CEO Bill Cheney said.
NAFCU Director of Legislative Affairs Brad Thaler said his association believes that raising the cap "would help small businesses access the capital they need to create new jobs and fund their businesses at no cost to taxpayers by simply allowing credit unions to use the capital that they have available."