The American Bankers Association has asked the National Credit Union Administration to extend the comment period on a proposal that would expand lending authority for credit union service organizations.
In a March 9 letter written by Timothy Keehan, the ABA's vice president and senior counsel, the banking trade group requested a 60-day extension to comment on the
The CUSO proposal would permit the credit union-owned entities to make more loans, including automobile and payday loans. As of now, CUSOs are only permitted to offer mortgages, student loans, credit cards and business lending.
"The proposal is comprehensive and represents a significant expansion of CUSO lending activities," the ABA letter states. "In preparing a written response, ABA as well as all interested parties need adequate time to read, understand, analyze and evaluate the proposal and the nature and extent of its impact and the risks imposed upon consumers, communities, and the financial services industry."
The letter also notes that NCUA Chairman Todd Harper has publicly opposed the proposal, saying that it “creates real reputational risk for the entire credit union system," according to the letter. Harper was elevated to the chairmanship shortly after the CUSO proposal came before the board.
If the extension is granted, comments would be due on May 28 rather than on the current deadline of March 29. The regulator extended comment deadlines on two different proposals last spring in the early days of the pandemic.
Representatives from the NCUA said the request is under review.
