Credit Union Board Modernization Act

Mr. Speaker, I move to suspend the rules and pass the bill (H.R. 975) to amend the Federal Credit Union Act to modify the frequency of board of directors meetings, and for other purposes.

Mr. Speaker, I ask unanimous consent that all Members may have 5 legislative days in which to revise and extend their remarks and include extraneous material on this bill.

Mr. Speaker, I yield myself such time as I may consume.

Mr. Speaker, I yield myself such time as I may consume.

Mr. Speaker, I rise in strong support of H.R. 975, the Credit Union Board Modernization Act.

I applaud my Committee on Financial Services colleagues, Representatives Vargas and Huizenga, for introducing it. This bipartisan bill will help focus credit unions' time and resources where it really matters, which is serving their members.

Federal credit unions are governed by boards of directors who are currently required by law, Mr. Speaker, to meet at least once a month. This outdated requirement prevents credit unions from attracting talented volunteers and professionals to a credit union's board due to the time commitment of a monthly board meeting.

Under H.R. 975, certain well-functioning credit unions are provided with the option to meet at least six times annually with at least one meeting held during each fiscal quarter of the year.

This crucial change frees up the time and resources used for meetings to put toward the critical mission of providing financial services to their credit union members. Importantly, this bill has guardrails to ensure the safety and soundness of our financial system. Only credit unions with a CAMELS composite rating of a one or two will be permitted to meet at this less frequent rate.

All credit unions, just like commercial banks, are subject to a supervisory rating scale. It is called the CAMELS rating. A credit union is assessed at each of the six categories under that acronym, and they are assigned a composite rating on a scale of one, the best, to five, the worst, based on: capital adequacy, asset quality, management, earnings, liquidity, and sensitivity to market risk, hence the acronym

Mr. Speaker, I yield 2 minutes to the gentlewoman from California (Mrs. Kim).

Mr. Speaker, I reserve the balance of my time.

Mr. Speaker, I urge all my colleagues to support H.R. 975. I appreciate Mr. Vargas sponsoring this good bill and Mrs. Kim speaking on it. They represent the State of California, and the State of California has some of the largest Federal credit unions active and headquartered in their State.

This will be a great service to those credit unions particularly and their home State of California to be able to focus on their members and have a few less meetings. I thank the gentleman from California for his sponsorship.

Mr. Speaker, I urge a ``yes'' vote, and I yield back the balance of my time.

Mr. Speaker, I yield myself such time as I may consume.

Mr. Speaker, I thank Chairman Hill and Ranking Member Waters for their support throughout this process.

Mr. Speaker, I rise in support of H.R. 975, the Credit Union Board Modernization Act. Credit unions are a vital part of our country's economic stability and success. These not-for-profit, member-owned institutions serve over 140 million Americans. Yet for over 40 years, volunteer-led Federal credit union boards have been burdened by an unnecessary requirement on meeting frequency.

This bill gives financially sound and well-managed Federal credit unions the flexibility they deserve. It will adjust the board meeting requirement by allowing qualifying Federal credit unions to move from the current monthly meeting to meeting a minimum of six times annually with at least one meeting each fiscal quarter.

This is a commonsense fix that allows Federal credit unions with a proven record of stability to dedicate more time and resources to the local communities they serve, like in San Diego, my hometown, and across the country.

This fix also makes it easier for more Americans who currently are not able to serve on these boards, due to the time commitment, to have an opportunity to bring their perspectives to the table. This bill contains key safeguards to ensure stability and mitigate risk.

Newly formed credit unions and those with poor ratings, as Mr. Hill stated, will still be held to the current monthly meeting requirements. Under this bill, only Federal credit unions with strong ratings from our Federal regulators and proven management capacities and capabilities will be eligible for the new meeting requirements. This reasonable bipartisan bill passed the House twice in both the 117th and 118th Congresses.

Again, I thank my colleague, the gentleman from Michigan (Mr. Huizenga) for working with me on advancing this legislation and his deep knowledge of the issues. It was actually a pleasure working with him again.

Mr. Speaker, I urge all of my colleagues to support this bill, and I reserve the balance of my time.

Mr. Speaker, credit unions are vital to our economy and to our communities. I urge my colleagues to support this bill and the consumers and small businesses that they serve.

Mr. Speaker, I yield back the balance of my time.

Mr. Speaker, I thank Chairman Hill for yielding.

Mr. Speaker, I rise in strong support of H.R. 975, the Credit Union Board Modernization Act. I also want to stand up and echo and reiterate the points that I already addressed because this legislation is so important.

This bill would amend the Federal Credit Union Act to revise the frequency of the board meetings a federally chartered credit union must hold. Under current law, credit union boards must meet once per month, but this bill, H.R. 975, would allow credit unions to lower that threshold of required meetings to six per year.

This bipartisan bill is needed to increase flexibility and unlock more resources for credit unions to better serve their members and our communities.

Additionally, H.R. 975 creates an incentive for credit unions to improve their management ratings by decreasing the number of board meetings for those that have the best management ratings. On the other hand, credit unions that are poorly managed or are new Federal credit unions will still be required to meet on a monthly basis.

I commend my colleagues, Representatives Huizenga and Vargas, for reintroducing this commonsense piece of legislation, and I urge my colleagues to support H.R. 975 and eliminate burdensome regulations to let credit

unions do what they do best, which is to service their communities.

As you heard, this has been passed in the 117th and 118th Congresses. I think it is time to bring this home, and let's get this done this Congress.