WASHINGTON –After months of political wrangling, the House is scheduled to vote Tuesday on a measure that would give credit unions some of the regulatory relief they have been seeking.
The Credit Union Bank and Thrift Regulatory Relief Act (H.R. 6318) also grandfathers in existing designations of underserved areas and allows federal credit unions to apply to serve underserved areas outside their field of service. Loans in those communities and to religious non-profit institutions would not count against their Member Business Loan cap.
The bill is being considered on an expedited schedule and being placed on the Suspension Calendar, which means it could pass by voice vote. If a recorded vote is taken, it must pass by a two-thirds vote in the 435-member chamber. The measure’s fate in the Senate is unclear.
The measure, which also allows financial institutions to pay interest on business checking accounts, was a compromise between banks and credit unions. Banks had previously been a major force in stopping regulatory relief for credit unions because they felt it gave credit unions an unfair competitive advantage.
H.R. 6318 does not raise the overall MBL cap, which is 12.5% of a credit union’s total assets. It is introduced by House Financial Services Committee Chairman Barney Frank (D-Mass.) and Rep. Paul Kanjorski, (D-Pa.), and Ed Royce (R-Calif.) the main sponsors of legislation providing regulatory relief for credit unions as well as Rep. Dennis Moore (D-Kan.), a key backer of regulatory relief for banks.