Madam Speaker, I would thank the gentlelady from West Virginia for her support. I rise in support of H.R. 3584, the Capital Access for Small Community Financial Institutions Act. This bill simply makes a statutory change that would allow…
Madam Speaker, I would thank the gentlelady from West Virginia for her support.
I rise in support of H.R. 3584, the Capital Access for Small Community Financial Institutions Act. This bill simply makes a statutory change that would allow nonfederally insured credit unions the right to apply for membership with the Federal home loan banks. It does not guarantee that they would receive membership. They would have to go through the membership application like everyone else. Similar legislation passed the House in 2006, with a bipartisan vote of 415 for, none against.
Purchasing a home is part of the American Dream, and this bill will help these small credit unions be able to make more mortgage loans as they use the Federal Home Loan Bank for liquidity and help more people live the American Dream. This bill would help those credit unions be able to have the liquidity that they don't have today.
The Federal Home Loan Bank, which was established in 1932, has been an important part of credit and liquidity for mortgage lending for the past 80 years for most Main Street institutions. Unfortunately, 132 small credit unions don't have that support right now. While most large and small institutions who are members of the Federal Home Loan Bank are able to use it every day for liquidity and to serve their customers, these 132 small credit unions in nine States with assets that total about $11 billion are left out because of a glitch in the law.
There will not be any additional risk to the Federal Home Loan Banks as a result of this. No more than $4 billion would be pledged, probably, as a result of this. So there is no real concentration risk.
I do want to thank Mr. Meeks from New York for his amendments that helped strengthen the bill. And while these credit unions don't have, I think, much risk to the institution, I think Mr. Meeks' amendments will ensure that the Federal Home Loan Bank is never put at risk by the authorizing language in this legislation.
You know, credit unions didn't have Federal insurance until the 1970s, and many small credit unions have continued to have private insurance and remain State-regulated. Those are the institutions we are talking about today, and there is precedent for institutions like them to join the Federal Home Loan Bank. So I believe that it is appropriate to allow them to not be discriminated against and allow them to use the Federal Home Loan Bank and ensure that they can serve their customers the same way other Main Street banks and credit unions can.
Again, this bill does not guarantee that any institution will become a member of the Federal Home Loan Bank; it simply gives them the ability to apply.
I want to thank Mrs. Beatty from Columbus, Ohio, and Ranking Member Waters for their support in the Financial Services Committee. I want to thank Mrs. Capito and Mr. Meeks for working with me on this bill.
As you heard, this bill passed the Financial Services Committee by a vote of 55-0. I would ask my colleagues to support this legislation and correct an oversight that doesn't allow these institutions to use the Federal Home Loan Bank and doesn't allow many of their customers to live the American Dream. So hopefully we can correct that today by supporting this.