Friday, April 8, 2011

CU Business Lending Bill Introduced in the House

Reps. Ed Royce (R-Calif.) and Carolyn McCarthy (D-N.Y.) introduced the Small Business Lending Enhancement Act (H.R. 1418). The bill would raise the member business-lending cap for certain credit unions from 12.25 percent to 27.5 percent of total assets.

The legislation would raise the cap for well-capitalized credit unions that are approaching the current legislative cap of 12.25 percent of assets (defined as member business loans to asset ratio of at least 9.80 percent) for four consecutive quarters immediately preceding their application date; can demonstrate at least five years experience soundly underwriting and servicing such loans; and have the requisite policies and experience in managing them. Credit unions also would have to satisfy other standards that the National Credit Union Administration Board determines are needed to maintain their safety and soundness.

Sen. Mark Udall (D-Colo.) introduced a similar bill (S. 509) on March 9.
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