On Tuesday, Sen. Dianne Feinstein (D-Calif.) signed on as a co-sponsor to Sen. Mark Udall's (D-Colo.) bill that proposes an increase in the member business loan cap.
The bill – S. 509, the Small Business Lending Enhancement Act – calls for a cap increase to as high as 27.5 percent of assets for eligible credit unions, NAFCU.org reports.
With Feinstein's support, S. 509 has now garnered the support of 20 co-sponsors, while H.R. 1418 has 58 after adding Rep. Darrell Issa (R-Calif.), the chair of the House Oversight and Government Reform Committee.
S. 509 was first introduced in March and the identical H.R. 1418, introduced by Rep. Ed Royce (R-Calif.) in April. Both would facilitate additional lending to small businesses without the need for taxpayer dollars.
In June, Mike Lussier, the president and CEO of Webster First FCU in Worcester, Mass., and the chair of NAFCU, told a Senate Banking Committee hearing that his credit union was being forced to turn away requests for small business loans as it reached the 12.25 percent of assets MBL ceiling over one year ago.
Credit unions are prepared to handle more MBL authority, NCUA Chairman Debbie Matz testified. This additional MBL authority would allow member-owned cooperatives to diversify their loan portfolios and cut concentration levels, NAFCU.org reports.