KANSAS CITY, Mo. -- The 104th Congress could be a hostile place for credit unions, said the top lobbyist for the industry's largest trade association.

Unlike in past Congresses, "there's a lot of people out there who don't love credit unions," said Charles O. Zuver, director of governmental affairs for the Credit Union National Association.

During a panel discussion Monday at the trade group's annual convention here, Mr. Zuver called Rep. Joseph P. Kennedy 2d's September hearing on extending the Community Reinvestment Act to credit unions as a "precursor for the 1041h Congress.

"Bankers have been working on members of Congress for years, and a lot of people feel we aren't doing the job we were chartered to do," he said. "We've been hearing a hue and a cry from COngress about why credit unions aren't lending more money."

Mr. Zuver said lawmakers are wondering why So much money is in investments and corporate credit unions.

Corporates also could create a problem for the industry in Congress, said Bob Loftus, director of public and congressional affairs for the National Credit Union Administration.

The industry's "white ' hat image" would be soiled, be said, if CUNA sues the agency over a regulation to split interlocks between corporates and trade groups.

The agency issued a proposal last month, and the trade group has voted to go to court if the final regulation is "substantially similar."

Noting that House Banking Committee Chairman Henry B. Gonzalez is "fully supportive" of the agency's direction, "how do you think he's going to feel if CUNA sues us?" Mr. Loftus said.

The Texas Democrat earlier this year launched an investigation of corporates, including the interlock question.

Mr. LoftuS said the agency's action "derailed congressional pressure for legislation."

But Doug Duerr, president of the National Association of State Credit Union Supervisors, and Mr. Zuver argued that a lawsuit wouldn't raise eyebrows on Capitol Hill.

"It's common for banks to sue regulators," Mr. Duerr said. "To think Congress would recoil -- I don't see that."

Although the next legislative session might be antagonistic, the 103rd Congress was a good one.

The three lobbyists hailed bankruptcy reform and the Community Development and Regulatory Improvement Act of 1994 as advantageous for credit unions.

Mr. Duerr added that the interstate branching law could be a boon for state-chartered institutions.

"It opens the door for credit unions to change state laws if necessary," he said. This last Congress was also notable for what it did not do.

Two issues -- taxation of credit unions and merging the NCUA into another regulator --"weren't even on the radar screen," Mr. Loftus said.

He added that President Clinton is the first president not, to propose taxing the industry since the Ford Administration.

Nevertheless, credit unions must remain vigilant.

"There are. nine senators not running for reelection this year, and on the issue of taxing credit unions, seven of the nine were our friends," Mr. Zuver said.

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