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Matz urges removal of statutory MBL cap
ALEXANDRIA, Va., (11/25/09)--National Credit Union Administration (NCUA) Chairman Debbie Matz would like to see the statutory cap on credit union member business lending (MBL) increased or eliminated and wrote to the U.S. Treasury Department urging support for measures that would allow NCUA to establish the regulatory parameters. “I believe any lending limitations should be regulatory, not statutory. NCUA is best positioned to set requirements and maintain limits on member business lending, utilizing our direct supervisory knowledge and application of firm safety and soundness standards,” Matz stated in a Nov. 24 letter to Treasury Counselor Gene Sperling. Sperling had requested additional policy suggestions from the NCUA following last week’s Small Business Financing Forum, hosted by Treasury and the Small Business Administration (SBA) and attended by Matz. NCUA supports a proper balance of serving business lending needs with a prudent regulatory framework to protect safety of the institutions and of the National Credit Union Share Insurance Fund. “Historically, credit unions have been successful at making member business loans,” Matz noted. She urged the Department of Treasury and the SBA to support legislative and regulatory enhancements to allow “well-managed credit unions to make more business loans to members who need them.” “This will in turn help achieve your over-arching goals to create jobs and grow the economy,” she added. Credit Union National Association (CUNA) President/CEO Dan Mica said Tuesday that Matz’s strong statement is a significant step and that it will certainly help the overall effort to build support for lifting the statutory MBL cap, a change CUNA has been working for diligently. In testimony last summer, Roger Heacock testified on behalf of the Credit Union National Association (CUNA) that the current number one obstacle to more business lending by credit unions is the restrictive 12.25%-of-assets cap imposed on credit unions just over 10 years ago. The hearing was conducted by the House Small Business Committee. Heacock is president/CEO of Black Hills FCU, Rapid City, S.D., and that credit union was the South Dakota district SBA award-winner for writing more SBA loans in the state than any other financial institution during 2008-2009. The loans totaled just over $1.6 million, and averaged $56,703 per loan. CUNA has repeatedly urged members of Congress to support increased business lending capacity for credit unions by backing HR 3380, the Promoting Lending for America's Small Business Act, which would raise the amount of money a credit union can devote to business lending. CUNA President/CEO Dan Mica said that HR 3380, if passed, "would enable credit unions to continue to provide significant capital to credit union member-owned small businesses – up to $10 billion in the first year--and create as many as 108,000 new jobs." CUNA has sent similar letters to the House, Senate, President Barack Obama, White House Chief of Staff Rahm Emanuel,and other top administration officials.


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