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CFPA oversight limited to CUs with 10B assets
WASHINGTON (12/3/09)—The head of the House Financial Services Committee has agreed to exclude credit unions with $10 billion or less in assets from the examination and supervision authority of the proposed Consumer Financial Protection Agency (CFPA), a move strongly advocated by the Credit Union National Association (CUNA). An earlier version of the bill set the threshold at $1.5 billion. Committee Chairman Barney Frank (D-Mass.) said he would modify the current language of his CFPA bill so that credit unions with $10 billion or less in assets would not be subject to examination and supervision by the CFPA. Instead, their primary regulator would enforce rules established by the CFPA. CUNA has learned that the bill is being modified at the request of many Democratic members. This change boosts the current carve out up from $1.5 billion in assets and puts credit unions on equal footing with community banks, who were given the higher exemption under a recently adopted amendment. CUNA President/CEO Dan Mica thanked Frank, saying that Frank’s decision, which “effectively eliminates more than 99% of all credit unions from direct examination and supervision” by the CFPA, “is a clear indication he recognizes credit unions did not ‘start the fire’ of the current financial debacle and that their current regulatory regime, coupled with their cooperative structure, argues against credit unions contributing to a financial crisis in the future.” CUNA Senior Vice President of Legislative Affairs John Magill also today lauded Frank’s action, calling it “a very significant and positive development.” However, Magill added that credit unions must “bear in mind that legislation is a process not an event, and that process continues.” CUNA has opposed unnecessarily dividing credit unions by asset size in the legislation. “However,” Magill said, “once it became apparent that the legislation was going to move forward with an asset threshold, CUNA fought to secure parity for credit unions with the higher level established for banks.”


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