ARLINGTON, Va.—NAFCU Executive Vice President of Government Affairs and General Counsel Carrie Hunt has urged the leaders of Congress to raise the member business lending cap under the Federal Credit Union Act.
Hunt sent the letter on the heels of the NCUA board's approval Thursday of a final MBL rule that removes regulatory provisions not called for by law. The rule does not alter the federal statutory cap on credit union member business lending under the FCU Act.
“Currently, credit unions have a 12.25% asset cap on their member business lending, with loans of only $50,000 or less exempt from this cap," Hunt wrote. "Passed in 1998, these arbitrary thresholds are severely outdated and have not increased with inflation."
“Hunt noted that NAFCU supports several pieces of legislation that would provide credit unions relief from the cap, including the Credit Union Residential Loan Parity Act (S 1440/H.R. 1442), the Credit Union Small Business Jobs Creation Act\ (HR 1188), and the Small Business Lending Enhancement Act (S 2028).
The NCUA board voted 3-0 to approve the revised MBL rule, which, effective Jan. 1, 2017, eliminates the waiver process. Also, 60 days after the rule’s publication in the Federal Register, the personal guarantee requirement will eliminated.