The Independent Community Bankers of America has asked a federal judge to reject a motion by the National Credit Union Administration petitioning for the dismissal of a lawsuit filed by the ICBA that challenges recent revisions to the agency's member business lending regulation.
The move sets the stage for a Dec. 15 courtroom showdown that will determine whether or not the suit ICBA filed in September will proceed, according to Christopher Cole, the ICBA's senior vice president and regulatory counsel.
"Our bankers feel NCUA is an agency that has been pushing the envelope for years," Cole said in an interview Thursday. "They feel it needs to be reined in. … I haven't run into any community bankers who've opposed [the lawsuit]. They're in full support."
Earlier this month the NCUA filed a 31-page memorandum defending its member business lending, along with a motion to dismiss the suit, with the U.S. District Court for the Eastern District of Virginia.
The case, Independent Community Bankers of America v. National Credit Union Administration, has been assigned to Judge James C. Cacheris.
In a written statement supporting the ICBA's motion asking Judge Cacheris to quash the NCUA's bid to terminate the suit, Cole listed seven banks that have lost loans totaling more than $50 million to competing credit unions.
At issue in the suit is a provision that permits credit unions to exclude loans or loan participations made to nonmembers from counting against the statutory cap that limits a credit union's member business loan portfolio to roughly 12.25% of total assets.
The NCUA's board voted in February to approve revisions to the member business lending rule.