WASHINGTON (3/25/09)--Following his Senate Banking Committee testimony yesterday, Credit Union National Association President/CEO Dan Mica appeared on Fox Business Network to underscore the overall strength and safety of the credit union system and promote lifting the statutory member business lending cap as a way to help job-generating small businesses. Interviewed live in the Rotunda of the Cannon House Office Building, Mica said he wants consumers to know that the natural person credit unions--“where you and I put our money”--are safe and sound, with accounts federally insured to $250,000. “We are the most solid financial services system left in the U.S. by any measure,” he added, noting that credit unions’ average capital ratio of nearly 11% is well above the federal “well-capitalized” standard of 7%.
Mica explained the conservatorship of two corporate credit unions, U.S. Central FCU and Western Corporate FCU (Wescorp), stemmed from problems due to “collateral damage” in today’s economy. “It’s what you’ve been talking about all day,” he told Fox. “The rest of the economy is crumbling and it has undercut some of their holdings.” To help credit unions shoulder the cost of the regulators’ action Mica said CUNA is pressing for legislation to spread out the time credit unions have to recognize the cost of the assessment from one year to five or eight years. “Banks already have that authority; we think we should have similar authority,” Mica said. He added that CUNA’s interest in TARP or U.S. Treasury Department funds is as a backup so credit unions are not the only institutions walled off from this option if needed. “We’re talking about parity, we’re talking about a backup, and about equal authority to spread out payments for an assessment for problems these two corporates had,” Mica said. On small business lending, Mica told the Fox audience that lifting the cap would allow credit unions to help small business, which generate 70% of the nation’s jobs. “If we can raise that cap, we can make $10 billion in loans to middle America, Main Street, without a penny from the government,” he said. (See related story: MBLs spotlighted as CUNA testifies on reg restructure.)