June 17, 2011 – The Dodd-Frank Act includes several measures that will impede credit unions’ ability to lend to small businesses, but there are a number of House bills that could help rectify the situation, a NAFCU witness told a House subcommittee Thursday.
Mark Sekula, executive vice president and chief lending officer at Randolph-Brooks FCU, a NAFCU member, discussed the law’s impact during a hearing of the House Small Business Subcommittee on Economic Growth, Tax and Capital Access. In testimony submitted to the committee, Sekula cited key provisions that are of specific concern to credit unions, including:
These requirements are a few examples of what Sekula referred to as a “regulatory divide” among Congress, the administration and other policymakers that must be bridged if small business lending is to flourish. “Any congressional goal to promote lending will never be successful when the functional regulators are not on the same page,” he testified.
To address this situation, Sekula urged the committee to support several key pieces of legislation. He hailed H.R. 1315, to modify the vote threshold required for the Financial Stability Oversight Council to veto a proposed CFPB rule; H.R. 1121, to create a five-person commission to govern the CFPB; and H.R. 1667, which would delay the transfer date for the CFPB’s regulatory authorities until a director is confirmed.
Sekula also reiterated NAFCU’s view that the CFPB needs to focus more attention on unregulated financial entities such as payday lenders. “Consumers do need protection from predatory lenders,” he said. “We are hopeful that the CFPB will focus on these entities.”