WASHINGTON (6/19/12)—Brett Martinez, Credit Union National Association (CUNA) board member and president/CEO of Santa Rosa, California's Redwood CU, will discuss the regulatory burdens faced by credit unions and credit union involvement in some of the U.S. Small Business Administration's (SBA) financial assistance programs in a Thursday House Small Business investigations, oversight and regulation subcommittee hearing.
Martinez is also expected to address the benefits that increasing the credit union member business lending (MBL) cap to 27.5% of assets could provide to small businesses and the economy in general. CUNA has estimated that increasing the MBL cap, which currently stands at 12.25% of total assets, would inject $13 billion in new funds into the economy and create 140,000 new jobs, at no cost to taxpayers.
The hearing, entitled "Small Business Lending: Perspectives from the Private Sector," is scheduled to begin at 10:00 a.m. ET. The hearing will focus on the regulatory burdens faced by small business lenders, and how SBA loan program management could be improved, the subcommittee said in a release.
Robert Marquette, president/CEO of Members 1st FCU, Mechanicsburg, Penn., and banking industry representatives are also scheduled to testify during the hearing.
Eligible credit unions are currently able to participate in the SBA's Small Loan Advantage and Community Advantage programs, which are aimed at increasing the number of lower-dollar SBA 7(a) loans going to small businesses and entrepreneurs in underserved communities.
The SBA's 7(a) government-guaranteed loans can be used for variety of general business purposes, including working capital and purchases of equipment and real estate. The guaranteed portion of SBA loans does not count toward the credit union MBL cap.
CUNA in past testimony has encouraged the SBA to simplify some 7(a) loan documentation and processing requirements.