WASHINGTON–A new bill in Congress would not require credit unions to comply with the Community Reinvestment Act (CRA) but does codify a number of existing requirements. CUNA and NAFCU are divided in their response to the bill.
The American Housing and Economic Mobility Act of 2021, introduced by Sen. Elizabeth Warren (D-MA), has the backing of CUNA, the trade group said. CUNA noted the legislation codifies existing community outreach, input, and oversight polices already present in NCUA regulations. NAFCU, however, opposes the bill.
“We thank Sen. Warren for introducing this bill that explicitly excludes credit unions from CRA requirements and recognizing the services credit unions perform to historically underserved communities,” said CUNA President/CEO Jim Nussle in a statement. “Credit unions fully embrace their mission to serving individuals of modest means, and this legislation would allow credit unions to more readily meet the needs of these communities.”
CUNA reported that it, along with state leagues, and credit unions met, with Warren for months leading up to the bill’s introduction in the last Congress, “demonstrating that credit unions are better positioned to serve underserved communities without being subject to requirements of the CRA.”
According to CUNA, aubjecting credit unions to CRA requirements would “require them to shift resources away from increasing access to responsible financial products to satisfying additional compliance demands. CUNA and leagues believe this would frustrate, rather than benefit, the objectives of increasing access to credit and capital in underserved communities.”
NAFCU, however, said the bill adds to CU reg burden, saying that while the package would allow some credit unions to add underserved areas to their fields of membership, it would also subject them, and community chartered credit unions, to new statutory requirements.
"NAFCU appreciates policy changes that would allow credit unions to proactively serve our nation’s underserved communities,” said NAFCU Executive Vice President of Government Affairs and General Counsel Carrie Hunt. “However, adding reporting requirements and putting into statute that a credit union's charter can be revoked for failing to hit arbitrary benchmarks is completely counter to good public policy. "The answer to serving the underserved is simply allowing the credit union model to thrive, not creating new burdens," Hunt added.