Senate Banking approaching reg relief vote

WASHINGTON (4/12/06)--A Senate Banking Committee spokesman Tuesday confirmed that a mark up on a financial institutions regulatory relief bill could occur as early as the end of this month.

The Senate has yet to introduce a much-anticipated measure, currently being drafted by Sen. Mike Crapo (R-Idaho), but committee spokesman Andrew Gray confirmed that the banking panel intends to move to a vote "shortly after Congress returns from its recess."

Congress recessed April 8 for Spring District Work Periods and is scheduled back to work on April 24. Earlier reports have predicted that the Banking Committee intends to vote on a bill on April 27.

Gray said Tuesday that if the vote is not held on that date, then it would likely happen no later than early May.

"It's definitely moving forward," he said.

The House voted 415 to 2 in March in favor of the Financial Services Regulatory Relief Act (H.R. 3505).

The Credit Union National Association (CUNA) has urged Crapo to include in a Senate bill a more reasonable ceiling for member business loans of 20% of assets and a National Credit Union Administration recommendation to reform prompt corrective action rules in the Federal Credit Union Act to reflect a capital system for credit unions that more accurately reflects risks.

Those provisions are not contained in the House version, but that measure does include more than a dozen elements that seek to undo burdensome requirements specific to credit unions by allowing:

• Leases of land on federal facilities for credit unions;

• Investments in securities by federal credit unions;

• An increase in general 12-year limitation of term of federal credit union loans to 15 years;

• An increase in 1% investment limit in credit union service organizations;

• Member business loan exclusion for loans to non-profit religious organizations;

• Check cashing and money transfer services to be offered within the field of membership;

• Voluntary mergers involving multiple common bond credit unions conversions involving common bond credit unions;

• Credit union governance;

• The National Credit Union Administration greater flexibility in responding to market conditions;

• Exemption from pre-merger notification requirement of the Clayton Act;

• Treatment of credit unions as depository institutions under securities laws

• Clarification of definition of net worth under certain circumstance for purposes of prompt corrective action

• Amendments relating to non-federally insured credit unions, including permitting privately insured credit unions to become members of the Federal Home Loan Banks.