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WASHINGTON-The American Bankers Association issued an Action Alert to its members this month, urging them to write their lawmakers expressing their disapproval of the Credit Union Regulatory Improvements Act (H.R. 3579). The sample letter ABA provides includes “required text” stating the bankers’ strong opposition. “There are now more than 80 credit unions with more than $1 billion in assets,” the letter states. “These institutions, many of which offer the full range of financial products and span areas as large as the state of Maryland, dwarf the typical, $95 million-community bank. It is hard enough competing with these tax-exempt giants. The last thing community banks need is for these large credit unions to expand their unfair marketplace advantages.” The letter goes on to state that CURIA is “disguised as a regulatory relief bill,” but makes fundamental changes to credit unions’ powers. It specifically mentions the member business lending cap increase to 20% and the dollar increase of reported business loans from $50,000 to $100,000. “Credit unions were chartered to serve individuals of modest means – not to make commercial loans,” the letter argues. “This major expansion of business lending authority would benefit only the largest, most aggressive credit unions, while putting both smaller credit unions and tax-paying financial institutions at a greater competitive disadvantage.” ABA’s sample also states that the risk-weighted capital system would “artificially inflate the capital cushion, thus reducing the actual funds available to protect depositors and taxpayers if credit unions were to experience financial difficulty.” The Action Alert was developed in coordination with ABA’s State Association Credit Union Coordinating Committee, according to ABA Director of Public Relations Charlotte Birch. She added that this Action Alert is nothing unusual from ABA and that the trade association sent its own letter in December expressing its objections to the legislation. In addition to the two previously mentioned provisions, CURIA would permit credit unions to lease office space in underserved communities and provide all of the relief included in the Financial Services Regulatory Relief Act (H.R. 1375) except for the provision allowing privately insured credit unions to join the Federal Home Loan Bank System. CURIA currently enjoys bipartisan support from 37 co-sponsors. [email protected]

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