House commission hears competing arguments over bill to expand Banco de Desarrollo lending to mortgages, credit cards and consumer loans

Members of the House of Representatives' Commission on Banking, Insurance and Commerce on June 16 heard competing testimony on House Bill 701, which would amend Articles 2 and 3 of Law No. 22 (the enabling statute for the Banco de Desarrollo Económico para Puerto Rico) to expand the bank’s lending powers to include residential mortgages, consumer loans, credit cards and other financing products; the committee held a public hearing but did not take a final vote.

Why it matters: supporters say the change would expand access to credit for groups they say are underserved—including young people and small businesses—while opponents warned the shift would push a development bank into direct competition with private banks and cooperatives and expose the government to fiscal and operational risk.

The hearing began with an opening from the Asociación de Bancos de Puerto Rico, represented by its president Mea Álvarez Rubio, who argued the proposal would “alejar al Banco de Desarrollo Económico peligrosamente de su rol fundamental” and stressed the lack of empirical data in the bill’s expositional material to justify expanding the BDE into consumer and mortgage markets. The association…