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Bernanke More MBLs a direction to consider
WASHINGTON (7/23/09)--U.S. Federal Reserve Chairman Ben Bernanke on Wednesday said that legislation that would lift the current member business lending (MBL) cap beyond the statutory rate of 12.25% would be “worth looking at.” Responding to Sen. Charles Shumer’s (D-N.Y.) direct question on small business lending, Bernanke told legislators at a Wednesday Senate banking committee hearing on monetary policy that lifting the MBL cap would be “a direction to consider” as the Fed looks to enable small businesses to have greater access to crucial loans. Schumer earlier this year announced that he plans to draft a bill that would raise the MBL cap. Rep. Ron Kind (D-Wis.) in recent months indicated that there is a "growing sentiment" among members of Congress that the MBL cap should be lifted. Credit Union National Association (CUNA) Small CU Committee member and Allied CU President/CEO Frank Michael recently told a Senate subcommittee hearing that giving the National Credit Union Administration the authority to lift the MBL cap above 20% of assets would "safely and soundly" result in $10 billion in new small business loans within one year. In a Monday story posted in The Wall Street Journal Online, CUNA Chief Economist Bill Hampel said that while credit unions continue to lend to small businesses, they could provide further assistance if the MBL cap was higher. Bernanke during the hearing also commended credit unions for their role in increasing minority involvement in U.S. financial markets through reduced-cost remittances. Rep. Luis Gutierrez (D-Ill.) last month said that he would introduce remittance-related legislation aimed at correcting some of the disclosure and transparency issues faced by the remittance industry. Gutierrez also hinted that larger reforms, including the possible creation of a federal regulatory regime for the remittance industry, could be a part of the ongoing financial industry regulatory reorganization.


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