Congress yesterday approved legislation that one analyst believes may help free up capital so regional and community banks can buy more ATMs, although a top bank executive does not see a direct correlation. Both the U.S. Senate and the House passed the bill, which would increase the borrowing authority of the Federal Deposit Insurance Corp., which insures the nation's banks, and the National Credit Union Administration, which insures federally chartered credit unions. President Obama may sign the legislation Friday. The legislation would allow the FDIC to borrow up to $100 billion from the U.S. Treasury. The National Credit Union Administration would be able to borrow up to $6 billion. Both the FDIC and the National Credit Union Administration previously announced plans to levy special assessments on banks and credit unions to replenish the agencies' insurance funds, which have been depleted because of bank and credit union failures. FDIC Chairman Sheila C. Bair said if Congress passed the bill and Obama signed it, it would lead to a "meaningful reduction" in the special assessment. The FDIC's board is scheduled to meet Friday to determine the size of the special assessment, which will be levied on banks' domestic deposits. Some bank executives believed the special assessment could have been as high as 20% for every $100 of domestic deposits. "We believe that the special assessments on banks and credit unions announced this year have contributed greatly to the lack of willingness by these community financial institutions to spend on ATMs," Gil Luria, an analyst with Wedbush Morgan Securities in Los Angeles, wrote in analyst report. "We believe that the announcement of these assessments in January and February, after bank budgets were already set, significantly threatened many banks' capital positions and effectively froze their budgets." Executives employed by ATM manufacturers Diebold Inc. and NCR Corp. have complained that they are unable to sell ATMs to regional and community banks. Sales to national banks, however, may outpace last year's sales, the companies say. Despite Luria's contention, William A. Loving Jr., CEO and executive vice president of Pendleton Community Bank in Franklin, W. Va., says the threat of a special assessment did prompt some capital-expenditure concerns, but he did not link those concerns to the purchase of ATMs. But "a reduction in earnings gives you cause to think about any equipment expansion," Loving tells ATM&Debit News, a CardLine sister publication.