WASHINGTON—The American Bankers Association this week filed its non-binding statement of issues in its case against the NCUA's field-of-membership rule, which reveals that the group intends to raise the issue of whether any portion of a core-based statistical area (CBSA) that “excludes the core is a single well-defined local community is arbitrary, capricious or contrary to law,” NAFCU reported.
In its June 28 filing, the NCUA indicated that it intends to raise the issues of (1) whether the final FOM rule is contrary to statute because it defines "local community" to include a CSA with a population of no more than 2.5 million; and (2) whether the rule is contrary to statute because of its definition of "rural district."
In March, the district court upheld two challenged portions of the NCUA's rule and struck down two provisions. The court ruled the provisions that exceeded the NCUA's statutory authority include those that automatically qualify a CSA with fewer than 2.5 million people to be a local community and the increase to one-million people the population limit for rural districts.
The NCUA's FOM rule took effect in February 2017.
Amicus Brief Filed
NAFCU filed an amicus brief supporting NCUA's FOM rule last June. The association believes the NCUA's FOM rule is well within the agency's legal authority and is in keeping with the Federal Credit Union Act.
In December 2016, the ABA filed suit against the NCUA over this rule.
During its June open board meeting, the NCUA Board finalized a rule to further reform FOM rules. NAFCU emphasized that it has pushed NCUA's efforts to modernize FOM in order to allow credit unions to serve more consumers.