[Congressional Record (Bound Edition), Volume 158 (2012), Part 3]
[Senate]
[Pages 3465-3466]
[From the U.S. Government Publishing Office, www.gpo.gov]




                           TEXT OF AMENDMENTS

  SA 1831. Mr. UDALL of Colorado submitted an amendment intended to be 
proposed by him to the bill H.R. 3606, to increase American job 
creation and economic growth by improving access to the public capital 
markets for emerging growth companies; which was ordered to lie on the 
table; as follows:

       At the end, add the following:

             TITLE VIII--SMALL BUSINESS LENDING ENHANCEMENT

     SEC. 801. SHORT TITLE; DEFINITIONS.

       (a) Short Title.--This title may be cited as the ``Small 
     Business Lending Enhancement Act of 2011''.
       (b) Definitions.--In this title--
       (1) the term ``Board'' means the National Credit Union 
     Administration Board;
       (2) the term ``insured credit union'' has the same meaning 
     as in section 101 of the Federal Credit Union Act (12 U.S.C. 
     1752);
       (3) the term ``member business loan'' has the same meaning 
     as in section 107A(c)(1) of the Federal Credit Union Act (12 
     U.S.C. 1757a(c)(1));
       (4) the term ``net worth'' has the same meaning as in 
     section 107A(c)(2) of the Federal Credit Union Act (12 U.S.C. 
     1757a(c)(2)); and
       (5) the term ``well capitalized'' has the meaning given 
     that term in section 216(c)(1)(A) of the Federal Credit Union 
     Act (12 U.S.C. 1709d(c)(1)(A)).

     SEC. 802. LIMITS ON MEMBER BUSINESS LOANS.

       Effective 6 months after the date of enactment of this Act, 
     section 107A(a) of the Federal Credit Union Act (12 U.S.C. 
     1757a(a)) is amended to read as follows:
       ``(a) Limitation.--
       ``(1) In general.--Except as provided in paragraph (2), an 
     insured credit union may not make any member business loan 
     that would result in the total amount of such loans 
     outstanding at that credit union at any one time to be equal 
     to more than the lesser of--
       ``(A) 1.75 times the actual net worth of the credit union; 
     or
       ``(B) 12.25 percent of the total assets of the credit 
     union.
       ``(2) Additional authority.--The Board may approve an 
     application by an insured credit union upon a finding that 
     the credit union meets the criteria under this paragraph to 
     make 1 or more member business loans that would result in a 
     total amount of such loans outstanding at any one time of not 
     more than 27.5 percent of the total assets of the credit 
     union, if the credit union--
       ``(A) had member business loans outstanding at the end of 
     each of the 4 consecutive quarters immediately preceding the 
     date of the application, in a total amount of not less than 
     80 percent of the applicable limitation under paragraph (1);
       ``(B) is well capitalized, as defined in section 
     216(c)(1)(A);
       ``(C) can demonstrate at least 5 years of experience of 
     sound underwriting and servicing of member business loans;
       ``(D) has the requisite policies and experience in managing 
     member business loans; and
       ``(E) has satisfied other standards that the Board 
     determines are necessary to maintain the safety and soundness 
     of the insured credit union.

[[Page 3466]]

       ``(3) Effect of not being well capitalized.--An insured 
     credit union that has made member business loans under an 
     authorization under paragraph (2) and that is not, as of its 
     most recent quarterly call report, well capitalized, may not 
     make any member business loans, until such time as the credit 
     union becomes well capitalized (as defined in section 
     216(c)(1)(A)), as reflected in a subsequent quarterly call 
     report, and obtains the approval of the Board.''.

     SEC. 803. IMPLEMENTATION.

       (a) Tiered Approval Process.--The National Credit Union 
     Administration Board shall develop a tiered approval process, 
     under which an insured credit union gradually increases the 
     amount of member business lending in a manner that is 
     consistent with safe and sound operations, subject to the 
     limits established under section 107A(a)(2) of the Federal 
     Credit Union Act (as amended by this title). The rate of 
     increase under the process established under this paragraph 
     may not exceed 30 percent per year.
       (b) Rulemaking Required.--The Board shall issue proposed 
     rules, not later than 6 months after the date of enactment of 
     this Act, to establish the tiered approval process required 
     under subsection (a). The tiered approval process shall 
     establish standards designed to ensure that the new business 
     lending capacity authorized under the amendment made by 
     section 802 is being used only by insured credit unions that 
     are well-managed and well capitalized, as required by the 
     amendments made under section 802, and as defined by the 
     rules issued by the Board under this subsection.
       (c) Considerations.--In issuing rules required under this 
     section, the Board shall consider--
       (1) the experience level of the institutions, including a 
     demonstrated history of sound member business lending;
       (2) the criteria under section 107A(a)(2) of the Federal 
     Credit Union Act, as amended by this title; and
       (3) such other factors as the Board determines necessary or 
     appropriate.

     SEC. 804. REPORTS TO CONGRESS ON MEMBER BUSINESS LENDING.

       (a) Report of the Board.--
       (1) In general.--Not later than 3 years after the date of 
     enactment of this Act, the Board shall submit a report to 
     Congress on member business lending by insured credit unions.
       (2) Report.--The report required under paragraph (1) shall 
     include--
       (A) the types and asset size of insured credit unions 
     making member business loans and the member business loan 
     limitations applicable to the insured credit unions;
       (B) the overall amount and average size of member business 
     loans by each insured credit union;
       (C) the ratio of member business loans by insured credit 
     unions to total assets and net worth;
       (D) the performance of the member business loans, including 
     delinquencies and net charge offs;
       (E) the effect of this title and the amendments made by 
     this title on the number of insured credit unions engaged in 
     member business lending, any change in the amount of member 
     business lending, and the extent to which any increase is 
     attributed to the change in the limitation in section 107A(a) 
     of the Federal Credit Union Act, as amended by this title;
       (F) the number, types, and asset size of insured credit 
     unions that were denied or approved by the Board for 
     increased member business loans under section 107A(a)(2) of 
     the Federal Credit Union Act, as amended by this title, 
     including denials and approvals under the tiered approval 
     process;
       (G) the types and sizes of businesses that receive member 
     business loans, the duration of the credit union membership 
     of the businesses at the time of the loan, the types of 
     collateral used to secure member business loans, and the 
     income level of members receiving member business loans; and
       (H) the effect of any increases in member business loans on 
     the risk to the National Credit Union Share Insurance Fund 
     and the assessments on insured credit unions.
       (b) GAO Study and Report.--
       (1) Study.--The Comptroller General of the United States 
     shall conduct a study on the status of member business 
     lending by insured credit unions, including--
       (A) trends in such lending;
       (B) types and amounts of member business loans;
       (C) the effectiveness of this section in enhancing small 
     business lending;
       (D) recommendations for legislative action, if any, with 
     respect to such lending; and
       (E) any other information that the Comptroller General 
     considers relevant with respect to such lending.
       (2) Report.--Not later than 3 years after the date of 
     enactment of this Act, the Comptroller General shall submit a 
     report to Congress on the study required by paragraph (1).

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