Removing Barriers Blog

Letters sent prior to hearings with Fed and Treasury leadership
Posted December 02, 2020 by CUNA Advocacy

This week the Senate Banking Committee and House Financial Services Committee held their quarterly hearings on the CARES Act.  CUNA wrote to leaders of both Committees prior to the hearings with Treasury and Federal Reserve Leaders on implementation of the CARES Act.  

In the letters, CUNA reminded the Committees of the role credit unions have played in carrying the spirit of the CARES Act to their members by participating in the Small Business Administration’s (SBA) Paycheck Protection Program (PPP), modifying troubled loans and ensuring that members get the assistance they need to weather this crisis. Our comments on the implementation of the CARES Act include views on how SBA and Treasury have implemented the PPP, but also called on Congress to extend essential CARES Act provisions that expire at the end of the month, including the Troubled Debt Restructuring (TDR) and Central Liquidity Facility (CLF) provisions.

  • The CARES Act expanded the borrowing authority of NCUA’s Central Liquidity Facility to 16 times the paid in capital (up from 12 times). This is set to expire Dec. 31.

  • The CARES Act also exempts certain COVID-related loan modifications from Troubled Debt Restructuring (TDR) treatment, also set to expire December 31.

“Credit unions want to help as many Americans as possible. Under the CARES Act, credit unions are required treat members with Federally backed loans in a certain way, and they have been doing that. But it’s critically important to extend that same accommodation to other borrowers who need it,” the letter reads. “We need consistency in how consumers are treated. Therefore, we urge Congress to extend the CARES Act’s temporary TDR relief for an additional year, until the end of 2021.”

CUNA also shared comments on the implementation of the Paycheck Protection Program, including:

  • Expressing concerns about the loan forgiveness process and loan necessity questionnaires;
  • Urging Congress to pass PPP forgiveness legislation that has been proposed in the House and Senate; and
  • Calling on Congress to enact “commonsense liability protections” for PPP lenders.