WASHINGTON (4/11/14)--A Republican senator from Indiana introduced a bill Thursday intended to give credit unions and community banks some relief from "crippling financial regulations" enacted in the wake of the 2008 financial crisis.
Sen. Dan Coats said his bill would modify the way in which the Consumer Financial Protection Bureau (CFPB) requests information from financial institutions with less than $10 billion in assets. The CFPB would be required to use publicly available information or seek the requested information from existing banking regulators.
The Indiana Credit Union League and the Credit Union National Association support the legislation.
In announcing his bill, Coats noted that credit unions and community banks are paying a price of burdensome regulation for mistakes made by players on Wall Street. Credit unions and community banks "did not cause the financial crisis, but they are being treated as if they did by federal bureaucrats," he admonished.
John McKenzie, president of the Indiana Credit Union League, said Coats' bill would be a good first step to bringing a measure of relief from some of the burdens created for credit unions and community banks by the Dodd-Frank and its creation of the CFPB. He said credit unions face "crushing regulatory burdens" in the post-Dodd Frank world.
"We appreciate and support Sen. Coats' efforts to clarify that such reporting requirements need to flow instead through the reports that credit unions are already required to provide to their primary regulators," McKenzie said.
The Coats bill also would allow a financial institution's prudential regulator to deny any request for information from the CFPB, and would allow the CFPB to request only institution-specific information rather than industry-wide information.