The American Bankers Association along with 51 state bankers associations from every state today called on members of the House Rules Committee to reject the inclusion of the co-op charter enhancement legislation. credit under HR 2543, the Financial Services Racial Equity, Inclusion, and Economic Justice Act.
HR 7003, which has been added to HR 2543, is “self-serving” credit union legislation that banking associations say “passes itself off as a financial inclusion initiative.” The bill would expand the scope of membership and commercial lending authority for tax-exempt credit unions by claiming that these charter improvements would improve access to financial services in underserved areas. Community credit unions can already serve underserved areas if they identify a local need and choose to do so, the banking groups pointed out.
“The absence of Community Reinvestment Act requirements on credit unions in this legislation is extremely troubling,” the ABA and state associations wrote. “Any sincere effort to improve financial inclusion through credit unions must include comparable mechanisms to ensure accountability. Credit unions regularly tout their commitment to low- and middle-income communities, so they should welcome the opportunity to demonstrate that taxpayer dollars are being spent as intended.
The legislation also creates a highly controversial new loophole in the credit union business loan cap, which Congress put in place to keep the industry focused on its specific mission of “meeting credit and savings needs.” of consumers… with a focus on consumers rather than businesses. loans. »