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Washington
Rep. Sherman backs more MBL authority
WASHINGTON (1/9/09)—In a statement on the House floor this week, a senior member of the House Financial Services Committee backed lifting the credit union member business lending (MBL) cap as foremost among options that could help the economy without costing taxpayers money. Rep. Brad Sherman, a California Democrat, said it was “folly” for the U.S. Congress to “take one of the healthy groups of financial institutions in this country namely, the credit unions, and tell them they can't make the $100,000 loan that is desperately needed by the small businesses in our respective districts.” He made his remarks as he laid out his 2009 legislative agenda for his House colleagues Wednesday. He said, in part, that he looks forward to passing legislation within the jurisdiction of the Financial Services Committee that can help deal with the economic crisis and noted “ a couple of opportunities” for doing so. “First,” he said, “we can increase the amount of business lending that can be made by credit unions. Right now, we limit credit unions severely as to how much business lending they can do.” Congress could, for the duration of the country’s economic crisis, allow credit unions to make more small business loans of $100,000 to $150,000, he suggested. “We need to allow businesses in all of our districts to get that $100,000 loan that they need to expand or even to stay in business.” The Credit Union National Association (CUNA) has asked lawmakers to lift the business lending cap in upcoming economic stimulus legislation. An additional $10 billion in business loans could be made by credit unions in the first twelve months once the cap is lifted, CUNA has told members of the House and Senate, the Bush administration and President-elect Barack Obama’s transition team. Small businesses pay the price of the credit union business lending cap because they have fewer options; and in the credit crunch, some are finding they have no options at all, CUNA has advised.
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