WASHINGTON — On a day when lawmakers are looking at problems caused by other sectors of the financial services industry, NAFCU is reminding them of the benefits of regulatory relief for credit unions.
In a letter to members of the House Financial Services Committee, NAFCU President Fred Becker urged the lawmakers to raise the cap on member business loans from 12.25% to 20% of a credit union's assets and to enact a risk-based capital system.
He said those changes would help credit unions make up for some of the loss of capital in the economy as a result of the reluctance of some banks to lend money.
Becker also urged the committee, which is holding a hearing today on ways to restructure the regulatory system for the financial industry, to maintain NCUA as an independent agency.
"The mortgage practices that caused the subprime crisis stand in stark contrast to the credit union guiding principle of 'people helping people,'" he wrote. "NAFCU is pleased that credit unions did not cause the turmoil in the housing market, which has led to this deepening crisis. This was due in part to the oversight that the National Credit Union Administration (NCUA) provided the credit union community."
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