Coalition of Credit Unions Works to Gain Acess to Supplemental Capital (Misc News: March 21, 2012)
A group of credit union supporters has banded together to form the Coalition for Credit Union Access with hopes of promoting the Capital Access for Small Business Jobs Act.
Supporters of the legislation say that credit unions need access to supplemental capital to help them sustain healthy growth.
This is an opportune time to be talking about supplemental capital because credit union leaders are in Washington for the CUNA GAC where many are talking to their lawmakers. CUNA has said that its top priority is member business lending but has told credit union supporters to use that conversation to also raise the issue of supplemental capital.
Under current law, credit unions can only grow net worth through retained earnings. Because retained earnings often cannot keep pace with asset growth, otherwise healthy growth – such as growth resulting from taking deposits – can dilute a credit union’s regulatory capital ratio and trigger nondiscretionary supervisory actions under prompt corrective action rules,” the group says in its talking points.
“We view this issue as critical because the current law unfairly penalizes healthy credit unions by making it difficult for them to grow to serve their members' needs,” Linda Armyn, senior vice president of corporate strategies and government relations at $4.5 billion Bethpage FCU in Bethpage, N.Y., told CU Times.
Armyn added that the coalition is closely aligned with the national trade associations and is supported by CUNA and NAFCU. After it wins legislative approval for supplemental capital, the group will disband.
Find more about the coalition and supplemental capital at its website: www.creditunionaccessforall.com