WASHINGTON (11/19/08)—As the U.S. Congress investigates the evolving nature of the Treasury Department's Troubled Asset Relief Program (TARP), the Credit Union National Association (CUNA) is keeping the message before key lawmakers that credit unions must be included in any assistance plan.
CUNA backs a plan under which the National Credit Union Administration would develop a "shadow TARP" program for credit unions that would purchase mortgage loans and mortgage-related assets from credit unions, but wants backup funding from the Treasury if necessary.
In advance of yesterday's House Financial Services Committee oversight hearing on the Bush administration's actions to restore economic stability, CUNA wrote to the panel's chairman, Rep. Barney Frank (D-Mass.), and its ranking member, Rep. Spencer Bachus (R-Ala.), to press the case for credit union inclusion.
Last week, Treasury announced it would abandon its plan to purchase of troubled assets from financial institutions in favor of greater emphasis on capital infusions into financial institutions. That shift, said the CUNA letter, causes credit unions concern.
"Although the Emergency Economic Stabilization Act explicitly includes America's credit unions among the institutions eligible to participate under the (TARP) plan, the implementation of the program thus far has not included credit unions, and the Treasury's announcement makes it unclear how credit unions will be included," wrote CUNA President/CEO Dan Mica.
Mica stressed, "We hope that no credit union will need to turn to Treasury or NCUA for assistance. However, should the need arise, it is critical that the mechanisms Congress has put in place through the enactment of the Emergency Economic Stabilization Act work for credit unions as well as banks and other entities."
courtesy of cuna.org