WASHINGTON (9/30/08)—As the House failed to approve a $700 billion rescue of the financial industry Monday, the Credit Union National Association (CUNA) continued to encourage credit unions to assure their members that their deposits are safe and insured. News that the House rejected 228-205 the rescue package—legislation that had appeared poised to be approved by both the House and Senate Monday—sent the stock markets plunging from already depressed levels. “Credit unions have widely differing views about this legislation,” said CUNA President/CEO Dan Mica after the vote. He added, “Our major concern is that, whatever package ultimately comes forward, it should not in any way disadvantage credit unions. Further, while we are working to ensure that credit unions are eligible for what the package offers, we are also working just as hard to ensure credit unions never have to use the provisions of this legislation.” Ryan Donovan, CUNA vice president of legislative affairs, acknowledged that the situation is turbulent. “Congress is facing the toughest of decisions. And while the administration and our federal lawmakers grapple with the issues, credit unions can fill an important role reminding members that the credit union system is safe and sound,” said Ryan Donovan, CUNA vice president of legislative affairs. Reiterating comments made by CUNA in a letter to lawmakers Friday, Donovan said of the rescue package, “Inaction at this critical time is unacceptable. The consequences of inaction may have devastating effects on the financial system and American consumers." The proposed legislation would establish a program within the Department of Treasury to acquire troubled assets from financial institutions and the resell them at a later date, presumably at a higher value. Credit unions are included in the definition of financial institutions eligible to participate in the program. The bill also favorably deals with two issues that CUNA raised in letters to Congress last week. The Emergency Economic Stabilization Act of 2008 (EESA) does not include any mortgage bankruptcy cram down language. Also, the bill restates the authority of the Securities and Exchange Commission to suspend FASB's mark-to-market accounting standard if it determines that it is in the public interest and protects investors. "In this case, we were able to ensure credit unions would be eligible to participate and we successfully kept the mortgage bankruptcy cram down provisions out of the bill, not to mention that the final version bill included the mark-to-market language which we found favorable. "We believe that the House may try to take this or similar legislation up again later this week. We are hopeful that nothing relevant to credit unions will change," Donovan said.