Capitol News

Michigan Credit Union League issued the following announcement on March 27

On March 27, President Trump signed into law a $2 trillion stimulus bill, the CARES Act, to provide relief during the COVID-19 pandemic. The legislation was amended to include credit unions in several provisions that, through drafting oversights, had previously only included banks and other lenders and are meant to support struggling small businesses and protect consumer finances.

“The coronavirus relief and economic stimulus bill is a success for credit unions. The relief it gives our movement in Michigan means 5.5 million members will have greater access to the financial services they need and count on credit unions to provide,” said MCUL President/CEO Dave Adams. “The Michigan Credit Union League is thankful for the cooperative advocacy from other leagues and our national partners, CUNA, for the advocacy that made this bill happen.”

Credit union provisions in the bill include the following:

• Provides that credit unions are eligible to participate in the paycheck protection program, an expanded Small Business Administration 7(a) program, which would allow for 100% federally guaranteed loans to small businesses so those businesses can continue to cover their payroll, mortgage/rent costs, insurance premiums and other debt obligations;
• Reestablishes the Transaction Account Guarantee Program, in which the government guarantees certain noninterest-bearing transaction accounts through the FDIC or NCUSIF;
• Allows credit unions to participate in troubled debt restructuring, permitting credit unions to further modify existing loans;
• Expands NCUA’s Central Liquidity Facility, which serves as a liquidity lender to credit unions experiencing unusual or unexpected liquidity shortfalls.
• Includes credit unions in a current expected credit loss (CECL) delay for those entities currently required to comply with CECL.

MCUL has prepared a condensed summary highlighting those sections of the bill we believe credit unions would find interest in. CUNA has also prepared more detailed summaries on the CARES Act, the first focused solely on small business provisions contained in the bill and a second looking at all sections of the bill should you desire more information than is provided in the MCUL summary.

More information on the stimulus package, as well as resources for credit union action can be found here.

Original source can be found here.