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WASHINGTON-Credit union lobbyists have been saying for the last week that they expected the Senate Banking Committee’s version of regulatory relief to be less far-reaching than the House bill. They were right. Senator Mike Crapo (R-Idaho) has circulated a `matrix’ for the last couple years with over 170 potential items for regulatory relief on it, but has boiled a draft of the legislation down to just a relative few. A draft of regulatory relief language that has been floating around the committee has some provisions that apply across the board to the financial services industry, like allowing the Federal Reserve to pay interest on so-called `sterile’ Reg D reserves and commissioning a study on how to increase the effectiveness and efficiency of the Currency Transaction Reports. Then, each sector was given four provisions, NAFCU Director of Legislative Affairs Brad Thaler explained. The provisions that made the cut for credit unions included allowing minimal rent for land leases on federal facilities; increasing the standard loan maturity limit from 12 years to 15 years; permitting check cashing and wire transfers to anyone within the field of membership; and changing the definition of net worth for credit unions to avoid an unintended consequence of a merger accounting change. The draft legislation is rather minimalist and up until press time, there was still hope for a few modest additions to the credit union section. CUNA Vice President of Legislative Affairs Dean Sagar said a couple other provisions were being discussed as potential additions in a manager’s amendment that could have been presented at the markup slated for May 4; there were some cases where some members requested a little more information or wording was being ironed out, according to Sagar. One such provision from the House bill would have permitted credit unions not to count member business loans made to faith-based organizations under the business loan cap, he said. Another would have allowed credit unions to maintain their select employee groups when converting to community charters. He also said that CUNA was continuing to plug away for a provision to increase credit unions’ investment authority in credit union service organizations. Thaler added that no amendments had been filed as of the deadline before last Thursday’s markup of the bill, he does not expect any change from the draft out of the committee. “They’re trying to keep any amendment out of the package in the Senate,” he said. Senate Banking Committee Chairman Richard Shelby (R-Ala.) has a reputation for brief, efficient committee markups, Sagar followed up. Both lobbyists had pinned credit unions’ hopes for other provisions included in the previously overwhelmingly passed House’s Financial Services Regulatory Relief Act (H.R. 3505-see sidebar) to the House-Senate conference where the two bodies come to agreement before they pass identical bills and the package is sent to the White House for the president’s signature. Powerful House Financial Services Committee Chairman Mike Oxley (R-Ohio) is retiring at the end of this session and has said he would like to make regulatory relief part of his legacy, so there is a real impetus to get the bill into law. However, a knowledgeable source has told Credit Union Times that Oxley is prepared to accept the Senate’s version of the bill. Oxley gave a comment through his spokesperson, stating, “With any luck, we’ll be able to take their version without having to play ping pong or go to conference.” NCUA Director of Public and Congressional Affairs John McKechnie said the bill does not include the authority for the agency to examine vendors but it does provide NCUA parity with the other federal banking regulators in a number of other areas. The agency is continuing to push for risk-based capital for credit unions, he added. “It’s something to advocate. You continue to advance. You continue to talk to all the interested parties,” he said. If it does not happen on this vehicle, the possible another, McKechnie said. The week prior to the committee markup, NAFCU delivered a letter to the leaders of the Senate Banking Committee and Senator Crapo urging them to move forward with a piece of legislation. The April 27 letter, signed by President and CEO Fred Becker, stated, “There is a clear need for easing the regulatory burden on credit unions as we move forward into the 21st century financial services marketplace. Providing credit unions some relief from the regulatory burdens that they face will allow credit unions to better serve their members and meet their needs in a dynamic marketplace.” The federal credit union trade association pushed for the inclusion of several credit union-specific items in the bill, including risk-based capital and expanding business lending limits as well as check cashing and wire transfers for potential members and other items. [email protected]

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