Higher CLF cap moves forward

WASHINGTON (9/29/08)—As of Saturday afternoon, both houses of Congress have passed a government funding resolution that also contains a borrowing cap increase for the National Credit Union Administration's (NCUA's) Central Liquidity Facility (CLF) for Fiscal Year 2009.

The increased borrowing ceiling was included in a continuing resolution (CR) to keep the government funded into 2009. The legislation was approved 78-12 by the Senate on Saturday and was passed 370-58 by the House on Wednesday.

The CLF provision temporarily lifts an arbitrary $1.5 billion lending cap placed on the NCUA's liquidity facility. The increased cap would allow the CLF to lend up to approximately $41 billion to the Credit Union System.

Credit Union National Association (CUNA) Vice President of Legislative Affairs Ryan Donovan noted Saturday, "The higher lending cap has been sought by the NCUA in order to have an additional regulatory tool at their disposal, if needed, and CUNA has been working very hard over the past week to make this happen."

Donovan said that it is expected that the President will sign the continuing resolution, but, he warned, "Nothing is ever final in these closing days of Congress until it is official.

"This CR is the vehicle that will keep the federal government programs operating after October 1 until March of 2009. So, the CLF language is clearly part of a very important development."

courtesy of cuna.org