Sens. Sherrod Brown, D-Ohio, and J.D. Vance, R-Ohio, called on the Federal Reserve to ensure Ohio’s state-chartered credit unions can access the Fed’s Bank Term Funding Program (BTFP). The letter comes a day after CUNA, the American Association of Credit Union Leagues, and Leagues and Associations from 45 states wrote the Fed with the same concerns about the 106 privately insured credit unions in the U.S.
The BTFP is a new, temporary facility to make liquidity available for depository institutions, and its current terms exclude privately insured credit unions
“[T]he Bank Term Funding Program was created to support American businesses and households by making additional lending available to eligible depository institutions to help make sure they can meet any liquidity needs. State-chartered credit unions play a similar role to other credit unions and banks in their communities and have similar liquidity needs as those institutions,” Brown and Vance wrote. wrote the lawmakers. “We urge the Federal Reserve to consider these concerns in any modifications to the Bank Term Funding Program and consider other ways to increase liquidity options for these institutions under the unique circumstances arising from the recent bank failures.”
“Thank you to Sens. Brown and Vance for their leadership on this issue to ensure privately insured credit unions can access the capital they need to continue serving members and communities,” said CUNA President/CEO Jim Nussle. “Privately insured credit unions have long been included in any government liquidity program, and their exclusion from the BTFP would represent a significant shift in government policy on liquidity access.”
“All credit unions must have equal access to liquidity tools so they can strategically manage their portfolios and further instill consumer confidence," said Ohio Credit Union League Chief Advocacy Officer Emily Leite. "We applaud Chairman Brown and Senator Vance for championing all credit unions, especially those choosing private primary deposit insurance. This joint effort was made possible by the smart advocacy efforts driven by American share insurance and the CUNA/League system.”
Brown chairs the Senate Banking, Housing, and Urban Affairs Committee, and Vance is a member of the committee.