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No CRA for Credit Unions

DECEMBER 7, 2001



The National Credit Union Administration (NCUA) this month is expected to repeal a regulation that would have required credit unions to serve low- and moderate-income people living in their field of membership. The CRA-type requirement, called the Community Action Plan (CAP), was approved by the NCUA board in October, 2000, and was scheduled to take effect at the end of this year. The makeup of the board has changed under the current administration, and the current board has concluded that this regulation is not needed.

In applauding this expected move, Dan Mica, the CEO of the Credit Union National Association (CUNA), the industry's largest trade group, said, "Credit unions have a tradition of reaching out to low-income members.... Credit unions do not need to be prodded by unnecessary regulation." Sound familiar? That's what community bankers have been saying about their CRA requirement for years. The difference is that the credit union industry has a captive regulator that sometimes acts more like a cheerleader for the industry than an overseer.

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