It could be an anxious week for credit unions.
This is the last full week both chambers of Congress are expected to be in Washington and a host of matters relevant to the industry remain unresolved. The House is scheduled to wrap up its business by the end of this week, with the Senate staying on until Dec. 18, though there has been talk that House members could stick around longer.
Whatever happens, credit union groups are pushing hard in the short time remaining for an extension of provisions from the Coronavirus Aid, Relief and Economic Stimulus Act that would lengthen
That's not the only issue where the clock is ticking. A provision related to troubled debt restructuring also expires at year-end. If the TDR provision is allowed to lapse then it could become harder for credit unions to work with members who might be struggling financially due to the economic fallout from the coronavirus.
"But there’s another provision of the CARES Act that doesn’t expire that allows for borrower-initiated forbearance and foreclosure moratoriums on loans that are sol to Fannie Mae and Freddie Mac," Ryan Donovan, chief advocacy officer at the Credit Union National Association, said in an interview Friday. "That doesn’t expire until the end of the emergency declaration [and] creates a situation where if the TDR provision expires, loans sold into the secondary market could have different treatments than loans held in portfolio, and that could present a great deal of confusion and frustration … for credit unions."
Donovan and other industry watchers remain confident that CLF and TDR provisions can be extended before the end of the year, even if those actions don’t happen this week.
Still, one key credit union issue made it across the finish line with time to spare. The National Defense Authorization Act for 2021 survived the conference process without a component allowing banks similar low- or no-rent access to military installations that credit unions have. An earlier version of the NDAA passed by the Senate did not include that provision. The final bill must still be passed in both chambers and be signed into law by the president.
It’s not all good news, though. A disappointing November jobs report, released late last week, showed hiring slowing for the fifth consecutive month, according to the New York Times, and while more than half of those who lost their jobs early in the pandemic have been rehired, about 10 million Americans are still out of work.
The National Association of Federally-Insured Credit Unions said the discouraging hiring figures come at a time when the number of COVID diagnoses is rising rapidly across the country and the need for additional stimulus legislation is growing.
“The labor market added 245,000 jobs during the month, which is not nearly fast enough given the unemployment overhang,” Curt Long, chief economist and vice president of research at NAFCU, said in a statement. “Retail, restaurant, and government payrolls all contracted, and labor force participation dropped. This data should provide more impetus for Congress to pass a stimulus effort in order to nurse the recovery through the initial months of 2021 until a vaccine is widely available.”
Lastly, this is the final week to submit comments on NCUA’s 2021 budget proposal. NCUA Chairman Rodney Hood and board member Todd Harper
