November 03, 2015

Royce, Waters, Sherman speak up for CU reg relief in mark-up

Several lawmakers said credit unions need greater lending flexibility within their communities Tuesday during a House Financial Services Committee mark-up of financial sector regulatory relief measures.

Rep. Ed Royce, R-Calif., said he would favor providing such relief for credit unions through an amendment to H.R. 1660, the "Federal Savings Association Charter Flexibility Act of 2015."

H.R. 1660 would extend certain powers now held by national banks to federal savings associations without requiring a change in charter. Royce said he wanted to offer as an amendment his bill, H.R. 1422, the "Credit Union Residential Loan Parity Act," to exempt certain residential loans from the credit union federal statutory member business loan cap. But recognizing it would not be ruled germane, he urged the panel to keep a focus on credit union regulatory relief moving forward.

Royce was supported in his bid by committee Ranking Member Maxine Waters, D-Calif., and Rep. Brad Sherman, D-Calif. Sherman acknowledged that H.R. 1660 would facilitate more business lending but easing the MBL cap for credit unions would do even more.

Panel Chairman Jeb Hensarling, R-Texas, didn't address the MBL issue. But noting the committee has held numerous regulatory relief hearings and marked up many relief bills – including a number that credit unions have supported – he said the panel can't do everything at once.

NAFCU, in a letter to the committee Monday, said it opposed H.R. 1660 unless it was paired with credit unions also receiving additional relief from current regulatory constraints – for example, through an easing in MBL limits, access to supplemental capital or changes in statutory field-of-membership restrictions. Royce submitted NAFCU's letter for the record of Tuesday's mark-up.

The bill was reported out of committee by a voice vote and now awaits action by the full House.

NAFCU's letter noted support for:

  • H.R. 3738, the "Office of Financial Research Accountability Act of 2015," which ensures improved transparency and more-efficient interagency coordination while heightening cybersecurity protections at the Treasury Office of Financial Research. This bill passed the committee by a vote of 35-22.
  • H.R. 3557, the "FSOC Transparency and Accountability Act," which would improve the deliberative process at the Financial Stability Oversight Council by limiting the specified members of FSOC to one vote per member, among other provisions. This measure passed out of committee by a vote of 33-24.