WASHINGTON – Two senators yesterday introduced legislation that would let credit unions and banks appeal examination findings to an outside arbiter, similar to the bill being debated in the House.
“Rather than provide clear rules of the road for an institution to make prudent loans to credit-worthy borrowers, banking agencies have made the lending climate worse by allowing the regulatory pendulum to swing too far,” said Rep. Sen. Jerry Moran, one of the bill’s co-sponsors. “It is time to restore clarity and balance, and I hope this bipartisan legislation can accomplish that objective.”
The legislation, which would create a new outside ombudsman where credit unions and banks could lodge appeals, is opposed by NCUA and bank regulators, but supported by CUNA and NAFCU.
The measure has key bipartisan support in the House, but it appears to face a tougher path in the Senate. Banking Committee Chairman Tim Johnson recently asked the inspectors general at the banking agencies to study their exam practices, a process that could take several months.
