WASHINGTON–The Independent Community Bankers of America, the American Bankers Association and the National Community Reinvestment Coalition have sent a joint letter calling on Congress to schedule an oversight hearing for the National Credit Union Administration.
The groups said the hearing is needed in light of several recent NCUA rulemakings the groups said “would undermine important statutory guardrails designed to protect low-income consumers.”
The groups further noted that an NCUA-specific congressional hearing has not been held since 2015.
The letter was sent to Congress one day ahead of which the NCUA board approved its new “service facility” rule that allows common bond credit unions to add groups to their fields of membership in underserved areas by using shared branches and ITMs.
‘National’ FOMs
The ABA Banking Journal said in its report that the new NCUA effectively approves fields of membership on “a national basis—disregarding the statutory requirement that credit unions be in ‘reasonable proximity’ to the customers they seek to serve.”
During its meeting, some members of the NCUA board addressed that point, saying “reasonable proximity” has never actually been defined.
“Credit unions are not held accountable to fulfill community reinvestment activities, creating a regulatory inconsistency between banks and credit unions, even though both take deposits and should thus have similar requirements to meet needs and conveniences of the communities where they operate,” the groups wrote. “Absent such expectations, some credit unions are not making efforts to invest in lower-income areas.”