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FOR IMMEDIATE RELEASE

Washington (April 28, 2016) - National Association of Federal Credit Unions (NAFCU) President and CEO Dan Berger today hailed National Small Business Week and the bond between credit unions and small business. National Small Business Week runs May 1-7 and is sponsored by the Small Business Administration (SBA).

"Credit unions and small business have a unique, cooperative bond," said Berger. "Small business is the engine that helps drive our economy, and credit unions are a great source of capital for the Main Street businesses that promote economic growth and job creation."

Credit unions proved to be a particularly valuable resource for small businesses during the financial crisis. A2011 study commissioned by SBA's Office of Advocacyfound that during the 2007-2010 financial crisis, while banks' small business lending decreased, credit union business lending increased as a percentage of assets.

Federally insured credit unions (FICU) have outpaced banks in small-business loan growth over the past several years:

• 2011: Small-business lending was up 5.1 percent at FICUs, down 4.3 percent at banks.
• 2012: Up 6.5 percent at FICUs, down 1.5 percent at banks.
• 2013: Up 10.1 percent at FICUs, down 0.5 percent at banks.
• 2014: Up 12.4 percent at FICUs, up a modest 2.2 percent at banks.
• 2015: Up 12.2 percent at FICUS, up a modest 2.2 percent at banks.

Today, credit unions continue to help small business. However, they are hampered in this effort due to an arbitrary, statutory cap that limits their business loans to 12.25 percent of assets.

Berger has renewed NAFCU's call for action on legislation that would help credit unions do more to meet the credit needs of small businesses, a key element of the association'sfive-point plan for regulatory relief. He urged passage of the following legislation:

• Reps. Ed Royce, R-Calif., and Greg Meeks, D-N.Y., both on the House Financial Services Committee, reintroduced H.R. 1188,the "Credit Union Small Business Jobs Creation Act of 2015,"to raise the credit union member business loan (MBL) cap from 12.25 percent to 27.5 percent of assets for eligible institutions. Sens. Rand Paul, R-Ky., Sheldon Whitehouse, D-R.I., and Jack Reed, D-R.I., introduced similar legislation (S. 2028) last September.

• Rep. Jeff Miller, R-Fla., chairman of the House Veterans Affairs Committee, reintroduced H.R. 1133 to exclude business loans made to veterans from the MBL cap.

• Reps. Ed Royce, R-Calif., and Jared Huffman, D-Calif., in March 2015 introduced the "Credit Union Residential Loan Parity Act" (H.R. 1422) to exempt certain residential loans from the MBL cap.The exemption would apply to loans for non-owner-occupied, one- to four-unit dwellings and make it possible for credit unions to lend more to small businesses without running up against the current cap. Sen. Ron Wyden, D-Ore., introduced similar legislation in the Senate.

Credit unions' commitment to small business was bolstered in February when the National Credit Union Administration (NCUA) Board unanimously approved a final member business lending rule that eliminated the MBL waiver process and allows credit unions to determine if a borrower should be free from requiring a personal guarantee. Most rule provisions take effect Jan. 1, 2017; elimination of the personal guarantee requirement takes effect May 13.

Last year, Maria Contreras-Sweet, administrator for the SBA, and Berger signed a memorandum of understanding (MOU) that the two will work to promote investment in America's future entrepreneurs and economy. This partnership affords credit unions much-needed flexibility and more access to SBA to help serve their small-business members.

The National Association of Federal Credit Unions is the only national trade association focusing exclusively on federal issues affecting the nation's federally insured credit unions. NAFCU membership is direct and provides credit unions with the best in federal advocacy, education and compliance assistance.www.nafcu.org.

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Patty Briotta

Director of Public Relations

703-842-2820

pbriotta@nafcu.org