WASHINGTON—Support for CU regulatory relief continues to come from Washington, this time from Democratic vice presidential candidate Tim Kaine.
Kaine, during remarks he made in Colorado earlier this week, backed statements made by presidential nominee Hillary Clinton, who recently shared support for reducing the regulatory burden on CUs and community banks.
“What we want to do, without compromising the important financial regulation that we had to put in place after the recession to avoid another massive fiscal collapse, we want to make it easier, especially on community banks and credit unions, to engage in transactions with small businesses,” said Kaine, who is the former governor of Virginia and now serves as the junior senator for the state.
“This is very important. In fact, what you’ve seen is if you look at these institutions in 1995, a huge chunk of their loan portfolio was in small business,” he continued. “That’s actually significantly decreased over the last 20 years, partly because of the recession but partly because of the feeling on their side, that it takes as much work to write a $100,000 loan as it does to write a $10 million loan, so why not write the $10 million loan?
“But that means that the smaller businesses get left out,” Kaine continued. “So [for] starting business[es] and getting financing, we want to work with our credit unions and community banks.”
In response, NAFCU said it has pushed for legislative action to increase or remove the statutory 12.25%-of-assets member business lending cap for credit unions. NAFCU added that it has also highlighted a 2011 study from the Small Business Administration which found that credit unions continued to lend to small businesses during the financial crisis when banks cut back on lending.
Earlier this week, Clinton said she wants to “streamline regulations and cut red tape for community banks and credit unions, which are the backbone of small business lending in America.”
NAFCU President and CEO Dan Berger applauded the inclusion of credit unions in Clinton’s small business platform, which reaffirmed her statements about cutting red tape so credit unions can continue providing capital for small businesses.
NAFCU said its federal advocacy team has met with both Clinton’s and Republican presidential nominee Donald Trump’s campaigns and continues to advocate the need for regulatory relief for credit unions and to preserve credit unions’ federally tax-exempt status.