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Reid's TAG bill stirs MBL talk
Senate Majority Leader Harry Reid, D-Nev., on Monday introduced a banking-industry-soughttransaction account guarantee extensionthat NAFCU has suggested be passed in tandem with S. 2231, legislation to increase credit unions' member business lending authority.
Banking trades have been pressing for another extension of this "transaction account guarantee" program. NAFCU President and CEO Fred Becker, writing Reid and Senate Minority Leader Mitch McConnell, R-Ky., has urged the Senate to include an increase in credit unions' member business lending cap in any final legislation extending TAG.
S. 3637 is ready for Senate action at any time. Itreflects the parity NAFCU sought when the transaction account guarantee program was first proposed at the height of the financial crisis. That measure initially addressed only deposits in banks, and NAFCU pressed lawmakers to include accounts in credit unions as well. That parity was retained in the two-year extension currently set to expire this Dec. 31.
The legislation accomplishes the extension through revisions in the Federal Deposit Insurance Act and Federal Credit Union Act. FDIC and NCUA are required to adjust deposit and share insurance assessments as needed to maintain required insurance fund levels.
Banking trades are strongly opposing efforts to combine the TAG and MBL measures. Becker, writing Reid and McConnell, said clearing both would be a "win-win" for all concerned. Brad Thaler, NAFCU's vice president of legislative affairs, was quoted in the American Banker newspaper suggesting bankers' reaction to the notion indicates the idea could have traction.
If passed, S. 2231 would raise the statutory MBL cap from 12.25 percent of assets to 27.5 percent for eligible credit unions.
- "Banks clash with credit unions over lending bill,"American Banker 11/27
- "Becker urges CU action on MBL," 11/27
- "Becker: Pass combined MBL, TAG," 11/20
- Letter to Reid/McConnell, 11/19
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