FOR IMMEDIATE RELEASE
ICBA Criticizes Proposed NCUA Rule on SBA Lending
View Comment Letter
Washington, D.C. (Aug. 25, 2004)-The Independent Community Bankers of America (ICBA) criticized today a proposed rule by the National Credit Union Administration (NCUA) that would expand the ability of credit unions to make more Small Business Administration guaranteed loans.
"The NCUA proposal is another example of credit unions trying to expand their commercial lending powers," said Camden R. Fine, ICBA president and chief executive officer. "These changes will allow credit unions to evade the commercial lending powers established by the Credit Union Membership Act of 1998 and divert them from their central mission of serving the credit needs of low- and moderate-income consumers. Furthermore, these changes will shift more SBA Section 7(a) lending to tax-exempt credit unions, increasing the enormous tax advantage that credit unions already have over commercial banks and thrifts."
The NCUA proposal would amend the credit union Member Business Loan (MBL) rule to allow credit unions to make SBA loans under the SBA's less restrictive lending requirements instead of under the more restrictive lending requirements of the MBL rule. ICBA strongly opposes any relaxation of the MBL rule and urges the NCUA to retract the proposal.