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The "Financial Regulatory Improvement Act," a NAFCU-backed regulatory relief bill authored by Senate Banking Committee Chairman Richard Shelby, R-Ala., was approved by the committee in a party-line vote of 12-10 after mark-up on Thursday.

The package, which Shelby first released last week, includes several NAFCU-backed provisions for credit union relief and transparency at NCUA. The bill would require public NCUA budget hearings and require the agency to study the impact of its risk-based capital proposal on mortgage servicing assets.

Before the final committee vote, panel members approved an amendment from Sen. Pat Toomey, R-Pa., to raise the asset threshold for institutions subject to CFPB examinations from $10 billion to $50 billion. NAFCU supports this amendment, although the association has always advocated the exemption of all credit unions from CFPB regulation. Also added was a NAFCU-backed amendment from Sen. Mike Crapo, R-Idaho, to bar federal financial institution regulators, including NCUA, from participating in the Justice Department's Operation Choke Point initiative.

A substitute amendment to the bill from Ranking Member Sherrod Brown, D-Ohio, released Tuesday, was rejected along party lines, with 10 voting aye and 12 nay.

The bill will proceed to the full Senate, where it will require some Democratic lawmakers' support to pass with a supermajority of 60 votes.

"We applaud committee members for moving the bill forward, and we look forward to more progress being made on behalf of credit union regulatory relief," said NAFCU President and CEO Dan Berger. "This is a positive development and a solid step forward in overcoming the regulatory overburden the credit union industry now faces. However, more needs to be done – and we are working on the development of a bipartisan approach to get the job done."

Berger wrote Shelby and Ranking Member Sherrod Brown, D-Ohio, in advance of the mark-up to express NAFCU's support. He also emphasized NAFCU's support for the parts of the package that would provide credit unions parity with community banks in the Federal Housing Finance Act, index arbitrary asset thresholds in Dodd-Frank, require NCUA budget hearings, provide statutory relief from annual privacy notice requirements and create safe harbor qualified-mortgage (QM) status for eligible loans held in portfolio, among other things.

NAFCU staff will continue to monitor the debate and push for credit unions' concerns.