NCUA Likely To OK Reg Barring Some Expansions
The NCUA board is expected to approve a new regulation that will bar community-chartered or single common bond credit unions from participating in its underserved field of membership expansions, the heart of the agency's Access Across America program.
Under a proposal being worked out, NCUA will allow as many as 200 credit unions that have been granted underserved expansions, in apparent violation of the law, to be grandfathered to allow them to continue serving those communities, sources told The Credit Union Journal.
The new regulation would allow NCUA to settle an ongoing suit with the American Bankers Association and Utah bankers over the underserved program.
The suit charges that NCUA's underserved program violates provisions of HR 1151, the 1998 CU Membership Access Act, which restricted underserved expansions to multiple group credit unions. NCUA temporarily banned underserved expansions for community and single common bond credit unions after the bankers filed suit last fall, in recognition of the questionable legality of those expansions.
Ed Roberts can be contacted at eroberts