Washington, D.C. (Nov. 17, 2016)—The Independent Community Bankers of America® (ICBA) reasserted its challenge to the National Credit Union Administration’s unlawful commercial lending rule with a vigorous response to the agency’s motion to dismiss the case and evade judicial review. In its response, ICBA called on the federal court reviewing the NCUA’s dubious final rule to reject the agency’s motion to dismiss the case.
“ICBA reaffirms its pledge to vigorously challenge the NCUA’s commercial lending rule following the agency’s motion to dismiss ICBA’s lawsuit,” ICBA President and CEO Camden R. Fine said. “Community banks, consumers and the financial system at large are threatened by the NCUA’s rule allowing tax-exempt credit unions to exceed congressional limits on commercial lending activity. Contrary to NCUA’s claim that ICBA lacks standing to bring the suit, ICBA is in the best position to do so on behalf of its members.”
In moving to dismiss ICBA’s complaint, the NCUA has mischaracterized the case, which is both timely and ripe for resolution, ICBA said. This brief demonstrates ICBA’s standing in the case by outlining the tangible financial harm to community banks and local communities caused by the NCUA’s flawed rule. In fact, as the brief shows, the rule has already negatively affected the value of ICBA members and other community banks. ICBA filed as exhibits to its brief declarations from several community bankers and its executive vice president and senior regulatory counsel, Christopher Cole, describing how widespread the injury is to ICBA members.
ICBA’s lawsuit challenges the agency’s unlawful rule issued earlier this year allowing credit unions to exclude nonmember commercial loans or participations from their calculations of the member business loan cap. If allowed to stand, the NCUA’s final rule would allow tax-exempt credit unions to exceed limitations on commercial lending activity established by Congress while relaxing regulatory oversight—putting consumers and the financial system at risk.
The lawsuit, Independent Community Bankers of America v. National Credit Union Administration, was filed in the U.S. District Court of the Eastern District of Virginia in September. The ICBA response is available here. The declaration of Christopher Cole with exhibits is available here and the original legal complaint is available here.
The Independent Community Bankers of America®, the nation’s voice for nearly 6,000 community banks of all sizes and charter types, is dedicated exclusively to representing the interests of the community banking industry and its membership through effective advocacy, best-in-class education and high-quality products and services.