Friends No More: Bankers Try To Block MBL Rise
WASHINGTON – Even as they work hand in hand with credit unions to block the caps in debit fees, the banking lobby says it will continue to fight tooth and nail to prevent Congress from raising the limits on member business loans for credit unions.
“It’s a serious issue for our membership. It goes to the heart and core of our competition with them,” said Paul Merski, senior lobbyist for the Independent Community Bankers of America, which is sending a letter signed by 40 of its state affiliates to congressional leaders today opposing the increase in MBL limits.
The two recent lobbying allies will air their difference Thursday at a hearing by the Senate Banking Committee on proposed legislation to raise the credit union loan cap where CUNA, NAFCU, the ICBA and American Bankers Association–all close allies in the fight against debit fee caps–will square off on opposite sides this time. “We will work together when we can work together, but when there’s an unfair competitive advantage, when one pays taxes and the other doesn’t, then we have to fight them,” ICBA’s Merski told the Credit Union Journal this morning.
The community bankers, said Merski, are so opposed to increasing the MBL limit they were willing to pull their support from last year’s legislation creating a $30 billion federally backed loan fund for community banks when Congress proposed adding the MBL provision to the bill.
Like the Capital’s Cherry Blossoms, the effort to raise the limits on member business loans has become a perennial one in Washington with proposals floated in at least the past eight Congresses.
But the bankers remain as adamant as they were in 1998 when they convinced Congress to limit member business lending for the first time at 12.25% of credit union assets, as part of HR 1151, the CU Membership Access Act. The bankers have successfully blocked it every time.
At Thursday’s hearing NCUA Chairman Debbie Matz, CUNA President Bill Cheney and NAFCU Chairman Michael Lussier of Webster First FCU, will separately urge lawmakers once again to raise the MBL cap to as much as 27%, while representatives of the ICBA and ABA will urge defeat of the proposal.