The Biden Administration released a bare-bones funding blueprint for next year and it proposes a 22.2% increase for the Community Development Financial Institutions program, the opposite of Trump Administration budgets which always called for elimination of the program.
Reps. Tom Emmer (R-Minn.) and Ed Perlmutter (D-Colo.) have introduced legislation that would allow credit unions to expel members without a membership vote and provides a procedure for reinstatement.
There is a lot of disagreement about whether a proposed rule that would expand the types of activities that Credit Union Service Organizations can engage in, including originating any type of loan that a federal credit union may originate, will be beneficial or disastrous to various credit unions. The National Credit Union Administration has extended the comment period for another 30 days.
National Credit Union Administration Chairman Todd Harper thinks the proposed rule is “half-baked” but credit union trade groups are endorsing a proposal to increase the threshold for credit unions to be defined as “complex.” The proposed rule states that any risk-based net worth requirement would only apply if a credit union has more than $500 million in assets at a quarter’s end. The definition impacts the effect of the Risk-Based Capital Rule that goes into effect on Jan. 1, 2022.
The Consumer Financial Protection Bureau may reinstitute the agency’s rule that would require payday loan borrowers to demonstrate their ability to repay a loan before it is approved.
The Independent Community Bankers of America wants Congress to reexamine the credit union tax exemption and its relationship to credit union-community bank acquisitions. They believe that the acquisitions are putting small business lending experts at risk.
Credit unions might be forced to decline members or their deposits if the NCUA does not take action to ease credit union net worth ratio problems caused by the pandemic, CUNA and the American Association of Credit Union Leagues warned late last week.
House supporters of marijuana banking legislation are feeling confident that their bill, named The SAFE Banking Act of 2021, will pass the House (as it did in the last session) and then a version of it, unlike last session, will be considered in the Senate. The bill would provide a safe harbor for credit unions and banks that provide services to cannabis-related businesses in states where marijuana is legal. Currently those businesses are forced to operate on a cash basis.
Senate Republicans blocked legislation Thursday that would have prevented the federal Economic Impact Payments from being garnished for the payments of debts owed.
Without such legislation, credit union and banking trade groups have said they may have to allow court-ordered garnishment of the payments.
Due to the rapid and unexpected balance sheet growth at credit unions that occurred as a result of the pandemic stimulus payments, the National Credit Union Administration board approved an interim final rule that will allow large credit unions to use asset data from the end of March 2020 to determine if they are subject to stress testing and capital planning. The rule will be in effect during 2021 and 2022.