Banks Finding New Ways to Combat MBL Bill
April 10, 2012
April 10, 2012
As support grows in Congress for credit union member business lending (MBL) legislation, the banks are finding new ways to attempt to rally opposition to the cause. In an effort to fight S. 2231, a measure introduced by Sen. Mark Udall (D-Colo.) that would raise the cap on credit union business lending from 12.25 percent of assets to 27.5 percent, the banks have issued talking points and created a so-called Super PAC in an effort to expand their influence on Capitol Hill.
The American Bankers Association (ABA) released its talking points, which highlights the following four main arguments against the expansion of credit union lending capacity:
- “The legislation would be of no benefit to most credit unions.”
- “The legislation would harm community banks and local lending efforts.”
- “The legislation would take credit unions away from their mission.”
- “Supporters are trying to bypass the regular committee process.”
The Independent Community Bankers of America (ICBA) also sent the following message to the Hill last Thursday:
Subject: Stop the Credit Union Power Grab
According to the National Credit Union Administration, only 162 of the approximately 7,300 credit unions are near the current member business lending cap. Expanded member business lending powers only benefit a small handful of multi-billion dollar credit unions at the expense of smaller credit unions and community banks.
Stop the credit union power grab.
The banks have also created a new so-called Super PAC, supplementing the BankPAC, which already ranks ninth in spending in the current election cycle, with the newly-established Friends of Traditional Banking in an attempt to outmuscle the credit union grassroots effort.
“Congress isn’t afraid of bankers,” said Roger Beverage, president and CEO of the Oklahoma Bankers Association. “They don’t think we’ll do anything to kick them out of office. We are trying to change that perception.”
The SuperPAC is a result of the work of the Utah Bankers Association PAC, and its advisory council includes representatives from 10 other state banking PACs. It is just one part of a strategy that banks are openly discussing as a battle pitting the banks against credit unions—and a “battle” in which they are working to cast themselves as the victims.
“Clearly there are Members of Congress who have absolutely no reservations about kicking traditional banks in the teeth, and we are tired of it,” said Howard Headlee, president and CEO of the Utah Bankers Association. “We’ve got to be able to defend the folks who have the courage to stand up for us as well.”
“I am for any PAC that is going to defeat our enemies,” ICBA President and CEO Cam Fine said. “I agree with Howard [Headlee] on this. More power to him. I hope he raises a lot of money and hammers these guys.”
Questions? Contact a member of the Association’s Legislative Affairs team:
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