WASHINGTON-Senate debate on the bank reform bill finally began last week with the credit union lobby fighting to limit potential threats.
"The amendments are coming fast and furious and we are fighting off the hostile ones and passing the good ones," said Dan Berger, chief lobbyist for NAFCU, as numerous proposals were emerging that would regulate credit card interchange fees, limit interest rates on credit cards, limit fees on ATM transactions and even bring all credit unions over $1 billion under the consumer financial protection agency if they make student loans.
The debate began after the Republican minority agreed to give up their filibuster of the bill, which would create the new consumer protection scheme, set a new panel to oversee huge financial firms that pose a risk to the financial system and regulate derivatives.
The credit unions claimed victory early in the debate when the Senate agreed to eliminate a provision that would have required credit unions and banks to submit regular reports to their regulator on the origin of deposits. "We believe the existing NCUA data collection program provides sufficient information on members' income levels and services provided and that additional data collection from credit unions in these areas would be redundant and burdensome," said Ryan Donovan, senior lobbyists for CUNA.
"While well-intentioned, it is important to remember that credit unions already provide a wide range of information to the NCUA," said NAFCU's Berger, who teamed with CUNA and the Independent Community Bankers of America to convince the Senate to scrap the proposal.
But several other amendments were emerging that could harm credit unions or add to their regulatory burden. CUNA and NAFCU joined the banks to oppose the amendment to regulate interchange fees.
And NAFCU expressed its opposition to the proposal to bring credit unions over $1 billion making student loans under the proposed consumer financial protection agency. "Subjecting credit unions that provide student loans to additional regulatory burdens, combined with the recent Congressional elimination of the Federal Family Education Loan Program, which had enabled credit unions to offer government-backed student loans to their members and customers, could lead to fewer credit unions making student loans," said NAFCU President Fred Becker, in a letter to Senate leaders late last Wednesday.
Another proposal opposed by credit unions would limit ATM fees to 50 cents per transaction.
The credit union lobby was also continued to work to expand a provision exempting all credit unions under $10 billion form being examined by the proposed consumer protection agency to include the three credit unions over $10 billion (Navy FCU, Pentagon FCU and North Carolina State Employees' CU).
Hope appeared to be fading for an opportunity to add an amendment to the bill that would raise the cap on member business lending for credit unions or to allow credit unions to raise supplementary capital.
Debate on the massive bill-1,600 pages-is expected to continue this week as the Senate considers more than 100 amendments.
The bill will need to be reconciled eventually with a similar reform measure passed by the House earlier this spring.
