WASHINGTON – Leaders of the credit union movement will ask the Senate Banking Committee this afternoon for help paying for the $5 billion corporate credit union bailout by allowing NCUA to stretch out the assessment for the bailout to as long as eight years and to expand the powers of the $41 million emergency credit union loan fund, known as the Central Liquidity Facility, to assist in the rescue.
Representatives of NCUA, CUNA and NAFCU are expected to make separate pleas to assist in the corporate bailout, which is expected to push as much as three-fourths of all credit unions into the red this year unless the cost can be alleviated in some way.
Banking regulators and executives will make a similar plea to help the troubled banks pay for their own bailout.
The credit union witnesses are: David Marquis, executive director of NCUA; Terry West, president of VyStar CU, and chairman of CUNA’s Task Force on NCUA’s Corporate Stabilization Plan; and David Wright, president of Services CU, who is representing NAFCU.
The three executives are expected to ask the Senate panel to support the proposal to allow NCUA to stretch out the $5 billion cost of the corporate bailout for as long as eight years; and to allow the CLF to provide direct access to corporate credit unions and to make capital infusions in both corporates and troubled natural person credit unions.
The provision to allow NCUA to stretch out the bailout assessment is attached to the controversial cramdown bill now before the Senate, but that bill has been delayed indefinitely by, among other things, opposition by the credit unions and banks.
