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Michigan Credit Union League Home » Government Affairs » Grassroots Advocacy » Action Alerts » Call to Action - Regulatory Relief Compromise  

Information Central Resources
Call to Action - Regulatory Relief Compromise


DATE: June 27, 2006

TO: Credit Union CEOs, Government Affairs Committee and Legislative Forum

FROM: Patrick La Pine, MCUL Vice President of Governmental Affairs

RE: Regulatory Relief Compromise

The Senate & House Financial Services Regulatory Relief bills have both been passed by their respective chambers. Rather than proceed with a conference committee, the House and Senate have instead decided to compromise by presenting various provisions back and forth between the two chambers.

House Financial Services Committee Chairman Mike Oxley (R-OH) and Ranking Member Barney Frank (D-MA) have transmitted to the Senate Banking Committee an initial compromise proposal to reconcile the differences between the Senate Financial Regulatory Relief Act (S. 2856) and the comparable House legislation (H.R. 3505). This initial “proffer” includes a proposal to remove all restrictions on small business lending by thrift institutions, currently capped at 20% of assets. There is no comparable provision offering member business lending relief to credit unions.

In general CUNA and the leagues do not oppose legislative or regulatory requests by the bank and thrift industries, preferring instead to focus on positive change for credit unions. In this case, however, we feel it is important for us to stand up and oppose the thrifts on this issue—one that would increase their advantage and diminish the credit union charter.

For the past several years we have been seeking to increase the cap on member business loans that was placed on credit unions when HR 1151 was passed in 1998. We have been told by Congress that such a provision for credit unions was too controversial to include in a general regulatory relief bill. Now, however, with the prospect of the thrift business lending cap being removed, we can no longer stand by and allow banks and thrifts to receive legislation that gives them a competitive advantage while our modest requests are deemed too controversial. If the thrift provision were to become law, it would severely damage the tenuous balance between federal thrift and credit union charters without comparable and offsetting benefits for credit unions.

The America’s Community Bankers (ACB) trade group is expressing great dismay over the credit union industry’s opposition to the thrift business lending provision and has declared an all-out war on credit unions. ACB and its supports no doubt will be appealing to their allies in Congress. It is imperative that credit unions respond with swift, bold action.


We need Michigan credit union officials to contact U.S. Senators Debbie Stabenow and Carl Levin as well as their Representatives immediately by phone, fax or email during the July 4th recess and deliver the following message:

  • Credit unions oppose the elimination of the current 20% limitation on business lending by thrift institutions included in the initial House proffer.
  • In order for credit unions to support such a proffer, we request credit unions receive parity with thrift institutions on business lending limits.
  • It is inappropriate for Congress to consider a substantial expansion in thrift business lending, and a significant enhancement of the thrift charter, within the context of Senate legislation that was intentionally drafted to avoid any disruption of the delicate balance between federal charters and regulators.
  • Credit unions do not seek this battle with the banks and thrifts; unfortunately the banking groups have continued to oppose ALL credit union regulatory relief provisions, including our efforts to modestly expand credit union business lending restrictions which are far more binding than those that apply to thrifts.

Attached is the letter CUNA sent to Capitol Hill opposing the thrift business lending proffer as well as the latest bank attack ad currently running in Hill publications. Click here to participate in this call to action.

If you have any questions, please feel free to contact me at 1-800-262-6285, extension 485 or or MCUL Political Affairs Coordinator Nancy Short at extension 353 or .

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