WASHINGTON (7/29/14)--The House Financial Services Committee is voting a series of bills today, two of which are strongly supported by the Credit Union National Association for the regulatory relief they would provide credit unions. Those bills are the Regulation D Study Act (H.R. 3240) and the Access to Affordable Mortgages Act of 2014 (H.R. 5148).
CUNA also strongly backs a possible amendment to The Community Bank Mortgage Servicing Asset Capital Requirements Study Act (H.R. 4042), which also will be voted on today. That bill would direct the federal banking agencies to conduct a study of appropriate capital mortgage requirements for mortgage servicing assets.
The amendment to that bill would require the National Credit Union Administration to similarly "stop and study" a provision of its proposed risk-based capital plan that would assign a 250% risk weight for mortgage servicing rights (MSR).
CUNA testified before the House Financial Services subcommittee on financial institutions and consumer credit last week that the MSR weight would be both "punitive and unnecessary" and should be reduced to 100%. That would place it at a level similar to what is required of small banks in Basel III requirements.
If the amendment is adopted today it would result in a delay in the implementation of the NCUA's RBC final rule until "an appropriate period of time "after the agency's study is completed.
Also in its testimony last week and in its letter of support sent Monday, CUNA strongly backed the Regulation D Study Act, which directs the Government Accountability Office to study the impact of the Federal Reserve Board's monetary reserve requirements.
Reg D limits the number of automatic withdrawals from a member's share account to six transactions per month and CUNA warns that this can cause consumers to overdraft if their checking account falls below $0 and the six transactions already have been made for the month.
CUNA supports an increase in the transaction cap, or for it to be eliminated altogether
CUNA also provided testimony on three discussion drafts, most notably the Access to Affordable Mortgages Act, which amends the Truth in Lending Act to exempt higher-risk mortgages from property appraisal requirements as long as the loan is held on portfolio for at least three years. In its support letter Monday, CUNA said the exemption would both provide regulatory relief for credit unions and other mortgage lenders, as well as increase access to mortgage credit for borrowers purchasing lower-cost dwellings costing $250,000 or less.
"The bill would allow credit unions that offer mortgage loans secured by covered properties to serve their middle- to lower-income members better," CUNA wrote. The letter went to House Financial Services Committee Chair Jeb Hensarling (R-Texas) and the committee's ranking Democrat, Rep. Maxine Waters of California.
For more on what is happening this week in Congress, see "This week in Congress: CUNA-backed bills to see House floor votes."