The House Finance Committee Thursday approved a bill that would permit holding companies with less than a 25% stake in a bank, credit union or other financial service company to cross market to each other’s customers.
Although the Financial Services Regulatory Relief Act (HR-3951) would ease many of the current restrictions on such firms, it would require them to tell current and potential customers about any negative financial information they pass on to a credit- reporting agency about them.
Committee Chairman Michael Oxley (R-OH) hailed the vote sending the measure to the full House for consideration. In a statement Oxley said the measure was an important part in removing “the needless and outdated laws and regulations” previously imposed on the banking and financial industry.
The bill, sponsored by Rep. Shelley Moore Capito (R-WVA) would also increase the ability of savings and loan associations to invest in small business investment companies and raise the time limit on credit union loans from 12 to 15 years.
At the same time, it would streamline the merger application requirements for financial holding companies, banks, credit unions and other financial service companies; permit interstate bank mergers between insured and non-insured banks with different home states; give banks more flexibility in paying dividends to investors, authorize money wire transfers for members and potential members by credit unions.
And, while it would ease existing restrictions on credit union loans to nonprofit religious organizations, it would also permit information sharing among federal banking agencies, including the National Credit Union Administration Board.
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