Capital Briefs: ABA Asks Court Not to Lift Credit Union Curb

The American Bankers Association urged the federal appeals court here to continue preventing credit unions from adding new companies to their fields of membership.

"The injunction the NCUA asks this court to lift has been in place for five months and none of the horrible things the (National Credit Union Administration) predicted have occurred," the ABA said in its March 13 brief. "There is no reason for this court to reverse position and stay the injunction now."

The NCUA and two credit union trade groups petitioned the court two weeks ago to lift the October injunction until the Supreme Court decides the AT&T Family Federal Credit Union case. The regulator argued that the health of some of the 3,586 occupation-based credit unions depends upon their ability to diversify their membership bases. But ABA said the regulator has failed to name a single credit union that would fail.

The AT&T Family case questions whether all members of an occupation- based credit union must share a single, common bond. The Supreme Court is expected to hold oral arguments in October and issue a decision in January.