The Senate last night followed the House's action earlier in the day and passed a bill that that includes a temporary stabilization fund for corporate credit unions.
The bill, which includes provisions relating to financial services and housing, passed by a voice vote in the Senate. This followed a 367-54 vote in the House several hours earlier. The measure now awaits President Obama's signature.
"As we move forward, I am confident that the program will be of tangible benefit to the credit union industry in managing the costs to maintain a healthy and well-capitalized Share Insurance Fund," NCUA Chairman Michael E. Fryzel said in a statement.
The fund, designed to cover the corporate stabilization costs, would be financed by a line of credit from the Treasury Department, which the NCUA would pay back over seven years. Natural person credit unions would pay the additional premium to the NCUSIF over that time period.
The measure gives the NCUA $6 billion in borrowing authority (up from the current level of $100 million) and $30 billion in emergency borrowing authority. The bill gave the NCUA eight years to replenish the NCUSIF if its equity ratio falls below 1.2%. The NCUA has estimated that shoring up the corporates could cost credit unions an assessment of between eight and 20 basis points a year over seven years.
The bill also extends insurance coverage of accounts up to $250,000 through 2013.
The health of corporate credit unions is on the agenda today in the House Financial Services Committee's Subcommittee on Financial Institutions at 2 p.m. (ET).
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