The National Credit Union Administration approved a rule to limit credit union expansion into underserved areas.
Under the rule, approved Thursday by a vote of 2 to 1, only multiple-common-bond credit unions may add underserved areas to their fields of membership.
The agency made the move after a lawsuit the American Bankers Association filed in November alleged that the NCUA illegally approved the expansion of a Utah credit union into an underserved area. The parties agreed in February to put the case on hold while they NCUA considered the rule.
Credit union trade groups had opposed the rule when it was proposed but Credit Union National Association Dan Mica said that the board's decision was the only option, "based on the advice of legal counsel."
