WASHINGTON (5/9/13)--A bill introduced Tuesday to allow privately insured credit unions to become members of the Federal Home Loan Bank System (FHLBs) would provide a new source of mortgage funding for those financial institutions and their members, the Credit Union National Association wrote Wednesday in a letter of support for the bill.
CUNA thanked Rep. Steve Stivers (R-Ohio) for taking leadership on the issue and introducing H.R. 1862. "Passage of this legislation would advance home ownership options for members of privately insured credit unions," CUNA President/CEO Bill Cheney wrote.
The FHLBs were created by Congress in 1932 to provide liquidity support to the nation's mortgage lenders. Credit unions and other financial institutions can access the FHLB liquidity system by becoming FHLB members. However, current law prohibits privately insured credit unions from joining.
Also on the FHLB front, CUNA earlier this year called on the National Credit Union Administration to approve the FHLBs as a permissible source of emergency liquidity for credit unions. The FHLB presidents also have urged the agency to adopt that policy.
"Such action would encourage and facilitate a stable source of funding to assist credit unions of all sizes in meeting their business, community, and member needs," the presidents wrote in a letter to NCUA Chairman Debbie Matz and board member Michael Fryzel. (Use the resource link for Feb. 4 News Now story: FHLBs ask to be named a CU emergency liquidity provider.)
Ensuring greater regulatory relief for credit unions continues to be a top CUNA priority, and CUNA continues to work closely with House Financial Services Committee members and staff as they develop legislative solutions to address small financial institution regulatory burden.
Removing legislative and regulatory barriers is also one of the key objectives outlined in CUNA's Unite for Good initiative. Unite for Good calls on credit unions to rally in support of a common vision where "Americans choose credit unions as their best financial partner."
For the full CUNA letter and a list of Unite for Good action steps, use the resource links.