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Bill to Raise MBL Cap Introduced
Tuesday, March 3, 2015 6:30 AM

Introduced by Reps. Ed Royce (R-CA) and Gregory Meeks (D-NY), the Credit Union Small Business Jobs Creation Act (H.R. 1188) is identical to a bill introduced by Royce in the last Congress and would raise the cap on credit union member business lending (MBL) to 27.5 percent of assets.

To qualify for the higher MBL threshold, credit unions must be well capitalized, have a history of MBL experience, be operating at no less than 80 percent of the cap for the previous year, and receive approval from the National Credit Union Administration.

Credit Union National Association estimates that raising the cap from the current 12.25 percent of assets would create 150,000 new jobs and allow credit unions to lend an additional $14 billion to small businesses, with no cost to taxpayers.

"Current regulations arbitrarily cap the ability of our nation's credit unions to lend to small businesses. Main Street businesses looking to expand and hire more workers have suffered as a result," Royce said in a statement. "The Credit Union Small Business Jobs Creation Act removes this obstacle to lending and ensures that qualified credit unions are better able to support Americans who need loans to start, sustain, or grow their businesses."

Raising the MBL cap is a major legislative priority for CUNA, due to the regulatory relief it would achieve. CUNA will send a letter of support for the legislation.