The lawsuit filed against the NCUA by the Independent Community Bankers of America (ICBA) Wednesday is without merit, CUNA President/CEO Jim Nussle said. The ICBA filed its suit in response to the NCUA’s revised member business lending (MBL) rule that was finalized in February.
“This baseless attack on the NCUA’s rule ignores the law and the NCUA’s authority in crafting regulations for credit unions,” Nussle said. “This lawsuit lacks merit, and is merely a self-serving publicity stunt to distract community bankers from the real issues that should be concerning them, namely the encroachment by large banks into the business of small banks and their resulting loss of market share.”
The lawsuit, ICBA v. NCUA, was filed in the U.S. District Court of the Eastern District of Virginia.
CUNA is reviewing the complaint and will take whatever actions necessary to protect credit unions’ interests. Its initial review of the complaint indicates the suit is baseless.
The MBL rule is consistent with the law, which provides significant constraints on credit union member business lending, CUNA believes. CUNA also believes the NCUA acted appropriately and followed all procedures when issuing the MBL rule and that the rule falls well within its statutory authority to interpret the application of the MBL cap.
CUNA supports the NCUA’s rule, which strips all restrictions from the MBL rule that are not specifically laid out in the Federal Credit Union Act. CUNA worked closely with the agency to ensure its waiver of the personal guarantee requirement, which became effective in May.
The rest of the rule is effective Jan. 1, 2017, and the agency said nothing has changed on that front.
Per the agency, it is reviewing the complaint and will respond in court.