CUNA urges Congress to act on economic rescue

WASHINGTON (9/29/08)—The Credit Union National Association (CUNA) urged every U.S. Senator and every member of the U.S. House to take "appropriate action" to restore the strength of the nation's economy.

"Inaction at this critical time is unacceptable given that the consequences of inaction may have devastating effects on the financial system and American consumers," wrote CUNA President/CEO Dan Mica Friday.

The CUNA letter reminded lawmakers that, despite current economic conditions, credit unions remain strong. The safety and soundness of the credit union movement can largely be attributed to the cooperative structure that "does little to encourage excessive risk taking," the CUNA letter noted.

However, the letter also reminded the federal lawmakers that credit unions are a sector of a much larger financial system which, by all accounts, is very ill.

"Credit unions did not cause the subprime lending crisis because they generally avoided the weak underwriting practices which contributed to the crisis. Still, despite the movement's good practices and overall health, credit unions are not immune to the effects of this economic crisis," the letter said.

CUNA urged that as Congress acts to restore the economy, the body must assure that credit unions have access to any programs created. The letter said CUNA appreciates that early drafts of the Troubled Asset Relief Act (TARA) give credit unions access to relief, if necessary.

"We hope that, as Congress coalesces around a remedy, credit unions will continue to be included."

Lawmakers were reminded that in the aftermath of the Great Depression, American consumers turned to credit unions to help meet their financial services needs. CUNA assured that as the economy recovers from this crisis, credit unions will continue to be there for their members on Main Street.

"We know credit unions cannot be the entire solution to the problems our economy faces, but we remain an important resource to the 90 million credit union members in the United States," the letter said.