Archive

Go to:

December 2017
SMTWTFS
12
3456789
10111213141516
17181920212223
24252627282930
31
< Nov Jan >
Leaguer Email Subscription

You are not currently subscribed. Click Subscribe below to receive the Leaguer email.

Nussle Reminds Bloomberg Radio that MBL Cap is Arbitrary
Wednesday, May 6, 2015 6:45 AM

Reminding Bloomberg Radio listeners that the current cap on credit union member business lending is "arbitrary" in the first place, CUNA President/CEO Jim Nussle also underscored that the lending limit stands in the way of credit unions getting additional capital into the economy.

In an interview Monday, Nussle was asked about slow economic growth in the first quarter of 2015. The CUNA leader said credit unions stand ready to get more capital into the market to boost the economic recovery as soon as the cap is lifted. CUNA backs legislation to lift the cap from to 27.5 percent of assets from the current 12.25 percent.

"Our momentum is really capped at this time, that's the whole point. We could provide a lot more momentum if we didn't have a [12.25 percent] cap," Nussle said. "We offer, we think, an opportunity to provide much more capital for lending purposes, and we think that should be at least considered by policymakers as they're trying to get the economy moving."

Nussle added that 85 percent of credit union member business loans are written for roughly $220,000, which he said is fairly significant for a small business, but not so much that increased lending would present safety and soundness issues.

"The bottom line is that [12.25 percent] is kind of an arbitrary number. It was selected back in 1998 by Congress," Nussle said. "I think now, looking at the marketplace, if you want to create jobs and economic growth, it's a time to allow all players to get into the field, particularly at a time when we're not seeing the kind of lending strength we need to get the economy moving."

Credit unions, as smaller institutions that serve smaller communities, typically have solid connections to those communities, putting them in position to better serve small businesses, Nussle said.

"We stand in a great position because of our situation, to be able to lend more to the market at a time when clearly there is a thirst for capital and a need to get it out there and help get the economy moving," he said.