Congress Eyes Quick HurricaneHelp

Register now

WASHINGTON - (09/09/05) -- Lawmakers are already draftinglegislation that would provide broad financial relief for victimsof Hurricane Katrina. Among the major concerns expressed this weekis the need to prop up confidence in small institutions damaged bythe massive storm and its aftermath, prompting several lawmakers tosuggest a temporary increase in federal deposit insurance todissuade depositors from removing large deposits from affectedbanks and credit unions. Sources told The Credit Union Journal thatdrafts of legislation being circulated this week would alsoindemnify institutions for bounced checks; eliminate charges forcash deliveries form the Federal Reserve; lower the threshold foridentification for cashing or depositing government checks; andallow for so-called fresh start loans that would allow creditunions and banks to recalculate loan accruals after failures to payover a period of time. The House Financial Services Committee hasscheduled a hearing for next week where the credit union and banktrade organizations will make recommendations on how to help in theimmediate aftermath of the huge natural disaster in Louisiana,Mississippi and Alabama. Both CUNA and NAFCU were working Thursdayto compile suggestions for a hurricane relief bill.

For reprint and licensing requests for this article, click here.
MORE FROM AMERICAN BANKER