Bill allows credit unions ‘appropriate ability’ to raise supplemental capital
CUNA President/CEO Jim Nussle wrote Tuesday in support of a bill that would allow credit unions to accept supplemental capital. The Capital Access for Small Businesses and Jobs Act (H.R. 1244) was introduced by Reps. Steve King (R-Iowa) and Brad Sherman (D-Calif.).
“We believe your legislation would provide credit unions with the appropriate ability to raise capital from sources other than retained earnings without putting in jeopardy the ‘one member, one vote’ principle that is the bedrock of the credit union ownership structure,” Nussle wrote. “This legislation would improve a credit union’s ability to maintain safety and soundness by allowing them to develop a supplemental cushion which ultimately reduces risk to the National Credit Union Share Insurance Fund.”
Specifically, H.R. 1244 would:
- Allow credit unions to accept other forms of capital, provided it does not alter the cooperative ownership structure of credit unions;
- Requires this capital to uninsured and subordinate to other claims against the credit union; and
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