BY JEFF McKINNEY
The Cincinnati Enquirer
The Senate dealt the banking industry a major blow Tuesday by passing a bill that would allow credit unions to keep existing members and again extend their services to millions of Americans.
But the bill lacks a House provision endorsed by the Clinton administration that would require credit unions to meet the fair-lending rules that banks already must follow to serve low-income residents and minorities where they do business.
The 92-6 vote would, in effect, reverse a Supreme Court decision in February that barred federally chartered credit unions from embracing members outside their core field of membership.
Under the bill, an estimated 73 million people who work for businesses too small to support credit unions would be able to affiliate with existing credit unions. Or they could pool their resources to form organizations of their own.
"We're obviously elated about this," said Gerri Guecking, president of the Hambuco Federal Credit Union in Fairfield.
Major bank trade groups have been bitterly lobbying against such legislation, saying it gives credit unions a competitive advantage because they pay no federal taxes and are not required to meet the same regulatory requirements as banks.
The Senate bill would let credit unions continue to accept members outside their primary membership as long as they come from companies or groups with fewer than 3,000 people.
Credit unions also could retain groups that they added in recent years to their core membership. The Supreme Court decision threatened the right of about 20 million consumers to keep their credit union membership, a potentially severe blow to credit unions' growth. The House passed a similar bill in April by a 411-8 vote. It still was unclear Tuesday, however, if the House would accede to some changes made by the Senate and speed the bill to President Clinton's desk. If the bill goes to a House-Senate conference, it probably would not be sent to the president until September.
Chris Binkert, a spokesman at Fifth Third Bank, Cincinnati's largest, said the bank cannot interpret how it might be affected by the Senate action until it sees the bill's final version.
