WASHINGTON (6/10/09)--Saying “I am a member of the credit union
family,” longtime credit union champion Rep. Paul Kanjorski (D-Pa.) said he supports lifting the statutory cap on credit union member business lending (MBL). He made the comments Tuesday at the National Credit Union Administration’s (NCUA) symposium highlighting the 75th anniversary of the 1934 Federal Credit Union Act. The symposium was organized by NCUA board member Gigi Hyland, who said its goal is to generate ideas and suggestions on the direction of the credit union movement that she can take back to the NCUA board for further discussion. Credit Union National Association (CUNA) President Dan Mica was among those attending. Rep. Kanjorski said lifting the MBL cap would be a quick way to stimulate the economy with $10 billion in new lending. Credit unions, he added, provide an important and needed service in this area. “Those business limitations must be raised,” he said, provided adequate enforcement is in place as a safeguard. Lifting or eliminating the MBL cap is one of CUNA’s top legislative priorities this year. The congressman also urged the NCUA to pursue its review of the corporate credit union sector, saying there should be fewer than 28 corporates, though he did not indicate how many. He expressed his preference for federal over private deposit insurance. And he reiterated his view that in credit union-to-bank conversions the members’ capital should be channeled to a not-for-profit entity such as another credit union, rather to a small group of insiders. Credit unions’ tax-exempt status is secure, he said, but credit unions must adhere to the core legislative principles that define them as not-for-profit cooperatives, democratically controlled, overseen by volunteer boards, and meeting the financial needs of all consumers, especially those of modest means. With the Obama administration due to unveil its proposal for financial regulatory reform next week, Kanjorski said the derivatives and hedge fund markets must be brought under government supervision, calling them a “silent cancer” that potentially can be disastrous for the economy if left unregulated. In conversation with CUNA’s Dan Mica afterward, he said the rating agencies also should come under closer congressional scrutiny. Kanjorski said that legislators should take a patient approach to any regulatory reform, as adhering to an arbitrary deadline would mean that they “are going to do a superficial patch-up" rather than a comprehensive overhaul of the financial regulatory structure. Hyland’s symposium continues through this morning. Mica commended her for hosting the event. “It is clear Board Member Hyland is committed to broadening the conversation and enhancing the credit union movement for its next 75 years,” he said.