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Washington
Bipartisan group urges House leaders on MBL cap lift
WASHINGTON (3/3/10)--A coalition of legislators earlier this week asked House Speaker Nancy Pelosi (D-Calif.) and House Minority Leader John Boehner (R-Ohio) to “do more to support America’s small businesses by modifying the statutory limitations that have currently prevented many credit unions from doing more to advance the economic recovery.” The letter, which was signed by 58 members of the House, specifically supported legislation introduced by Reps. Paul Kanjorski (D-Pa.) and Ed Royce (R-Calif.) that would lift the current 12.25% asset cap on member business loans serviced by credit unions to 25% of a given credit union’s total assets. The legislation would also increase the “de minimis” threshold for these loans to $250,000. Reps. Carolyn Maloney (D-N.Y.), Fortney Stark (D-Calif.) and Chellie Pingree (D-Me.), who were three of 34 new co-sponsors who agreed to support lifting the MBL cap following visits by credit union representatives during last week’s Governmental Affairs Conference, signed on to the letter. While “many financial institutions have pulled back on making small business loans as a result of the financial crisis” and regulators have noted that “banks—both large and small—have shrunk their business loan portfolios,” the letter noted that “credit unions remain willing to lend to their small business-owning members.” The letter also cited Credit Union National Association estimates which predict that lifting the MBL cap would result in $10 billion in new capital for small businesses, creating as many as 100,000 new jobs at no cost to American taxpayers. While the amount of small business loans would double to a total of 10% if the MBL cap is raised, the banking industry would still dominate the business loan market, with 90% of the total share of loans. “Any future jobs-creation legislation that the House considers” should include MBL legislation, the letter added.
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