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News Now

Washington
No CRA for CUs CUNA urges
WASHINGTON (9/16/09)--The Credit Union National Association (CUNA) has voiced its opposition to H.R. 1479, the Community Reinvestment Act (CRA) Modernization Act of 2009, in a letter sent to House Financial Services Committee Chairman Rep. Barney Frank (D-Mass.) ahead of Wednesday’s House hearing. Rep. Eddie Bernice Johnson (D-Texas), National Community Reinvestment Coalition President/CEO John Taylor, Massachusetts Commissioner of Banks Steven Antonakes, and National Urban League President/CEO Marc Morial will testify during the hearing, along with academics and representatives from various Washington-based interest groups. H.R. 1479, as currently written, would broaden the reach of CRA requirements to more entities, including credit unions. Under this legislation, credit unions would need regulatory approval to place new branches and would be forced to hold 30-day public comment periods before relocation, mergers, or field of membership expansions could be completed. While CUNA and credit unions in general support providing greater financial services to the underserved, CUNA opposes bringing credit unions under the purview of the broadened CRA legislation, saying that the “significant regulatory burdens” imposed on credit unions by this bill would create “unnecessary and possibly harmful” consequences for credit unions. According to CUNA, credit unions, which have not engaged in redlining nor reduced the amount of credit available to their members, “have done nothing to deserve the regulatory framework that has been rightly imposed on banks for their misdeeds.” The letter also takes issue with a recently released National Community Reinvestment Coalition (NCRC) paper that addresses whether or not credit unions are fulfilling their mission of serving their members. CUNA recently addressed the NCRC report, which unfavorably compares credit union lending practices to those of banks, dismissing it as a flawed report that should be dismissed by policymakers. This NCRC paper is expected to be discussed during the hearing, which is scheduled to take place at 10 a.m. today. The letter, which has also been delivered to members of the committee, includes a detailed response laying out what CUNA sees as the “fundamental flaws” in the NCRC report. To see the CUNA letter in full, and NewsNow’s coverage of the NCRC’s paper, use the resource links.


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