WASHINGTON (5/19/10)--In a Tuesday appearance on Fox Business Channel
, Credit Union National Association (CUNA) President/CEO Dan Mica spoke out against the “artificial” limits that have been imposed on credit union member business lending (MBL) and called on Congress to increase the MBL cap to 25% of a credit union’s total assets.
Credit unions are “well capitalized” and could “double the amount of loans” that they are currently servicing if that cap is lifted, Mica added. Mica also cited CUNA statistics that show that lifting the MBL cap would inject $10 billion in new funding into the economy and create as many as 100,000 new jobs, at no cost to taxpayers. Lifting the cap, which currently stands at 12.25% of assets, would not threaten the safety and soundness of credit unions or the credit union system, Mica added, as credit unions overall have a far lower loan default rate that that of banks. Mica on Tuesday also testified during a House Financial Services Committee hearing on increasing lending to small businesses. (See related story: MBLs: Mica testifies, Rep. Frank talks vote.) When asked about proposals to increase the amount of small business loans provided by banks, Mica said that if community banks need the aid of the government to spur on their own lending increases, he does not oppose them. However, Mica expressed puzzlement at banks’ continued opposition to allowing credit unions to increase their own small business lending capacity.