ICBA Files Legal Brief In FOM Case, Says CUs Abandoning ‘Urban Core’

WASHINGTON—The Independent Community Bankers of America and a number of affiliated state community banking associations have filed a legal brief that

ICBA

strongly supports the American Bankers Association’s appeal in its lawsuit challenging NCUA’s field-of-membership rule.

In a statement, the ICBA said the friend-of-the-court brief demonstrates firm community bank opposition to the NCUA’s “unlawful attempt” to drastically increase the powers of tax-exempt credit unions beyond their statutory limits.

“The NCUA’s rule allowing credit unions to serve entire metropolitan areas while abandoning their urban cores is another example of this captive regulator attempting to extend the industry’s taxpayer-subsidized competitive advantage at the expense of local customers and communities,” ICBA President and CEO Rebeca Romero Rainey said. “The ICBA-supported appeal is designed to prevent credit unions from flouting both congressional intent and the communities they were created to serve.”

The ICBA brief and the ABA lawsuit follow an NCUA board vote in October of 2016 that allowed for expanded fields of members.

The ICBA said the NCUA decision rendered “meaningless the statutory standard that limits these institutions to serving a well-defined local community, neighborhood or rural district.”

Judge’s Ruling

A federal judge last year vacated two provisions of the rule that would have defined combined statistical areas with fewer than 2.5 million people as local communities and increased the population limit for rural districts to 1 million.

In its appeal, the American Bankers Association is challenging the court’s decision to leave in place a provision of the rule allowing credit unions to serve metropolitan areas without serving their urban core.

“The appeal supported by today’s joint amicus brief argues that this provision counters congressional intent that credit unions serve persons of modest means,” the ICBA said. “The brief also urges the appellate court to uphold the lower court’s ruling that the NCUA rule unreasonably defines rural districts to automatically include entire states, vast non-rural areas, and major metropolitan centers.”

 

Section: Standard
Word Count: 414
Copyright Holder: CUToday.info
Copyright Year: 2019
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URL: http://www.cutoday.info/Fresh-Today/ICBA-Files-Legal-Brief-In-FOM-Case-Says-CUs-Abandoning-Urban-Core