HOUSE OK'S BILL EASING CREDIT UNION RESTRICTIONS.

Byline: Marcy Gordon Associated Press 

Congress passed a bill Tuesday that would allow more people to join credit unions, undoing a Supreme Court ruling that had restricted membership.

President Clinton said after the voice vote in the House that he would sign the measure, even though it lacks a key provision requiring credit unions to abide by fair-lending rules that banks already must follow. The Senate had overwhelmingly approved the bill last week.

Those community lending rules, long championed by Democrats and attacked by conservative Republicans, require banks to serve low-income people and minorities in their communities. But overall, the bill will make it easier for credit unions ``to expand where appropriate'' and ``ensures that consumers continue to have a broad array of choices in financial services,'' Clinton said in a statement.

Under the legislation, all current credit union members would be allowed to remain with their institutions. That gives credit unions a boost in their competition with smaller community banks to attract customers.

The legislation overrides a 5-month-old Supreme Court ruling by allowing federally chartered credit unions to continue to include more than one occupational group in their memberships, as long as each group doesn't exceed 3,000 people.

Credit unions contend they are the best source of help for people of modest means. But the banking industry has bitterly protested credit unions' exemption from federal taxes, an exemption retained by the legislation.

``I would say it was a victory of David over Goliath,'' Rep. Paul Kanjorski, D-Pa., one of the bill's original sponsors, said before the vote.

A feverish lobbying campaign has pitted the banking industry - which brought the lawsuit that reached the high court - against the 70 million-member credit union industry.