WASHINGTON — Sens. Catherine Cortez Masto (D-NV) and Bernie Moreno (R-OH) have introduced bipartisan legislation they said is designed to make it easier for credit unions to convert to or merge with privately insured institutions by lowering member-voting requirements for such transactions.
According to the senators, the proposed Private Insurance Parity Act would allow a credit union to convert to private share insurance or merge with a privately insured credit union if a simple majority of voting members approves the action. The legislation would replace the current requirement that at least 20% of a credit union’s total membership participate in and approve the vote within a limited timeframe.
The senators said the bill would also extend the voting period for such decisions to at least 90 days.
‘Flexibility to Serve More’
“Credit unions help hundreds of thousands of Nevadans grow their savings, buy their homes, and build their credit,” Cortez Masto said in a statement. “Private insurance gives these credit unions the flexibility to serve more customers. This commonsense fix will make it easier for our nation’s credit unions to seek private insurance or merge with privately insured credit unions.”
Moreno said the legislation would reduce regulatory hurdles for credit unions seeking alternatives to federal insurance.
“Local credit unions don’t need DC politicians telling them how to protect their members’ money,” Moreno added in a statement. “Our bipartisan bill gives these organizations the freedom they need to serve more Americans without unnecessary bureaucratic red tape.”
The senators said private insurance, including coverage provided by American Share Insurance, can allow credit unions to insure larger deposits and serve a broader range of industries. However, they argued that current federal voting requirements make it difficult for credit unions to pursue private insurance or complete mergers involving privately insured institutions.
Supporters of the measure said it would modernize regulations and provide parity between federally insured and privately insured credit unions.
CEO Expresses Support
In a statement released by the senators, Silver State Schools Credit Union President and CEO Scott A. Arkills said his institution’s experience with private insurance through ASI demonstrates that privately insured credit unions can operate safely while delivering value to members.
Arkills said ASI’s support has helped strengthen the credit union and provide operational and financial benefits to members, adding that the legislation would give credit unions greater flexibility to make decisions based on member needs.
Matt Kershaw, CEO of Create Credit Union, said the bill would remove what he described as outdated regulations that create obstacles for Nevada credit unions. Kershaw said private insurance can offer greater coverage on a per-person basis and noted that privately insured credit unions currently serve more than 172,000 Nevadans.
Statement from ASI
Theresa Mason, president and CEO of American Share Insurance, and Jeremy Empol said in a joint statement that the legislation would modernize conversion and merger requirements, promote parity for privately insured credit unions, support consumer choice and innovation, and strengthen state-chartered institutions.
According to Cortez Masto’s office, the senator has previously introduced bipartisan legislation related to increasing federal deposit insurance limits, expanding lending flexibility for non-primary residence loans, reforming the Federal Home Loan Bank system and supporting small-business capital formation.
The full text of the legislation can be found here.
