CUNA: MBL guidance should be open for comment prior to final rule

While CUNA supports proposed changes to the National Credit Union Administration’s member business lending (MBL) regulation, guidance should be released and open to comment before the rule is finalized.

In its comment letter to the agency sent Tuesday, CUNA praised the agency for moving from the current prescriptive approach to a more principle-based methodology.

“CUNA supports NCUA’s approach because it simplifies the regulation and removes many onerous business lending restrictions in the current rule not mandated by the Federal Credit Union Act (FCUA),” the letter reads. “The prescriptive approach may have been appropriate in the early years of business lending; however, in spite of the FCUA limitations and this prescriptive approach, credit unions across the country have developed robust commercial lending programs with experienced management and sound lending practices.”

CUNA also urged the agency to release and permit comment on the supervisory guidance it intends to issue. The proposal requires a more thorough examination of loans and policies by examiners, so the NCUA should provide consistent training and guidance to examiners, CUNA added.

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