CUNA wrote in opposition Thursday to a provision in a House bill that would place credit unions under the Community Reinvestment Act. The American Housing and Economic Mobility Act of 2018 (H.R. 7262) is the House equivalent of a Senate bill containing the same provision, which CUNA opposed in October.
“We believe extending the CRA to credit unions would represent a significant step backward in achieving expanded access to affordable mortgage credit and other financial services from reputable cooperative entities like credit unions,” the letter reads. “By statute, credit unions already operate to achieve the purposes of the Community Reinvestment Act…credit unions are community-based financial cooperatives that exist as an important alternative to these profit-driven banking models, to offer pooled savings and lending services for member-owners.”
The letter cites data showing credit unions deliver more than $15 billion in benefit to all consumers each year, in the form of lower rates on lending and higher dividends on deposits. It also shows how credit unions increased lending to low- and moderate-income mortgage borrowers by 48%, while bank lending over the same time period to low- and moderate- income borrowers decreased by 56%.
“Any policymaker interested in achieving more responsible credit union lending should support eliminating, or at the very least significantly reducing, statutory and regulatory barriers that limit credit unions’ ability to serve their members consistently with their statutory mission, as opposed to erecting new barriers that will be cheered by the very same abusive banks and non-bank lenders you and others have fought so hard to contain,” it reads.
The letter was sent to Reps. Cedric Richmond (D-La.), Elijah Cummings (D-Md.), Barbara Lee (D-Calif.) and Gwen Moore (D-Wis.).
CUNA Chief Advocacy Officer Ryan Donovan wrote in The Hill in October that placing credit unions under the CRA would be a “step backwards.”