ALEXANDRIA, Va. -- Federal regulators have loosened the Credit Union National Association's grip on the industry's liquidity centers.

By a 2-1 vote the National Credit Union Administration board last week approved a regulation that will cut back the number of managers that corporate credit unions and trade groups can share.

The rule, effective Jan. 1, 1996, will hit 20 of the 43 corporates.

NCUA Chairman Norman E. D'Amours said the regulation will end conflicts of interest in which CUNA officials control an institution and make decisions that benefit the trade group, not the corporate.

"It's clearly a safety and soundness issue," he said in an interview. "We're aware of decisions being made where corporate resources are being diverted to leagues for no good reason."

Last Thursday's vote closes, at least for now, a controversy that has split the agency and the industry for seven months. Drafts of the regulation issued in April and September garnered more than 800 comment letters, about 600 of them opposing change.

There still could be some fallout. Last month CUNA vowed to sue the agency if the final regulation was "substantially similar" to the September proposal. The industry's largest trade group now is considering its next step.

"We appreciate some of the changes made in the final regulation," CUNA president Ralph Swoboda said in a statement. "We'll take 30 days to compare it with the comment letters and gauge how well credit unions' concerns have been addressed."

The regulation, which was watered down, has five main points:

A majority of a corporate's board, including the chair, must be made up of credit union officials rather than trade group officials.

A majority of corporate directors may not work for the same trade association.

Corporate officials must distance themselves from any decision involving another organization to which they belong.

The chief executive of a corporate may not work for a trade association and must answer solely to the corporate's board.

Corporate membership may not be linked to membership in a trade group.

Mr. Swoboda accused the agency of worrying about "perception problems" instead of legitimate safety and soundness concerns. He added that the NCUA does not have the authority to interfere with the way corporate credit unions are run.

Mr. D'Amours said CUNA's opposition was based on self-interest.

"A problem with the regulation is it deals with a lot of people with a stake in the system," he said. "They're putting their own interests above safety and soundness and the long-range" health of the system.

Mr. D'Amours said dismantling interlocks was necessary before the agency could propose limits on corporate investments and stricter capital regulations. These new rules should be proposed by early next year.

"We would get better comment from an unintegrated system," he said.

CUNA wasn't the proposal's only opponent. NCUA director Robert Swan urged the board to withdraw the proposal before he cast the dissenting vote.

"I still have some major problems with this regulation," he said. "It's an intrusion on the business and management of our system. I do question whether there is the need for more regulation."

Mr. Swan also said he doubted NCUA had the authority to dictate the structure of state-chartered corporates and that small corporates will be harmed by when fewer managers are shared with the trade groups.

According to an analyst, the credit ratings of five of the largest corporates with interlocks are not likely to be affected by the regulation.

Nor would the ratings be harmed if the NCUA tightens investment regulations and requires corporates to boost capital.

"I really don't see any implications for the ratings we assign," said Jack Dorer, an analyst for New York-based Moody's Investors Service, in an interview.

Mr. Dorer also downplayed the concern, raised by some CUNA officials, that if credit unions control corporate boards, they would be more likely to take greater risks with investments.

"We feel the corporates are well managed and will continue to be," he said.

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