Archive Links

Consumer Archive
CU System Archive
Market Archive
Products Archive
Washington Archive

News Now

Washington
CUNAs Hampel to Fox News CUs hamstrung by MBL cap
WASHINGTON (3/2/10)--Credit unions feel “hamstrung” by the current member business lending cap of 12.25% and can help more of their members while creating 100,000 new jobs if Congress raises it, Credit Union National Association (CUNA) Chief Economist Bill Hampel told Fox Business Network in a live interview Monday. Hampel said that credit unions are “quite willing and able to make loans, but more and more they are having to slow down their lending because of this cap.” “We’re seeing more and more small businesses who are being turned down for credit” by their banks. Hampel was invited to do the Fox interview after USA Today on Monday ran a prominent story on the reasons CUNA and credit unions are pushing to raise the MBL cap (see related News Now headline story). Hampel told Fox there is no public policy reason against lifting the MBL cap. “Credit unions have a history of making these loans safely” with a loss rate that is a fraction of the bank loss rate on the same types of loans. Opposition to lifting the MBL cap “is not a safety and soundness issue.” Rather, Hampel said, the main “pushback” that credit unions are getting “is from the banking industry who don’t want any competition for their lending,” Hampel said. Banks have no cause to object, Hampel argued. Credit unions now have about 5% of the small business loan market; doubling that by raising the MBL cap would give credit unions 10%, still leaving the banking industry dominating the market with 90% share. According to CUNA estimates, lifting the member business lending cap to 25% of a credit union's assets would also result in $10 billion in new capital for small businesses and could potentially create as many as 108,000 new jobs within one year. Further, CUNA estimates that 60% of the business loans of credit unions affected by the current statutory cap are in credit unions that are within one month to three years of having to sharply curtail business lending because of the cap.
Other Resources

RSS print
News Now LiveWire
July 's Fed Bank's "FedFocus" has some interesting articles: incl cost/benefits of $1 currency 2 coin conversion ttp://tinyurl.com/nybmnhh
4 hours ago
Do you wish you were a News Now subscriber? Go here: http://t.co/7evfBSjeMx
5 hours ago
Financial education for student body key part of Altura #creditunion, UC-Riverside partnership #NewsNow http://t.co/Xp6OJd66o6
6 hours ago
.@VTcreditunions gains 200 new FB followers in just 2 wks to reach 1,000 http://t.co/I89xJcv4Jg
6 hours ago
.@CUNA is testifying on reg relief Tues,July 15 at 2 p.m. be4 Hs Fin Serv Subc. Here is the agenda and witness list: http://t.co/yBRhlmdqHt
9 hours ago