ALEXANDRIA, Va. – NCUA stood by its recent approval of a new investment fund pilot from CUNA Mutual Group in response to concerns from the American Bankers Association. CUNA Mutual's new CU Systems Fund, approved by NCUA at its March 17 board meeting, would allow for the purchase of business loans from credit unions and the sale of shares in them to interested credit unions. In a March 30 letter to Johnson, Jim McLaughlin, ABA director of regulatory and trust affairs, said more details should be disclosed before moving forward with the fund. "The pilot program provides credit unions with a permissible investment product intended to enhance liquidity and provide a reasonable return," Johnson wrote in an April 14 letter to McLaughlin. "The standards of the program are crafted to ensure diversification and limit risk exposure." Johnson also sent McLaughlin a copy of the NCUA Board Action Memorandum and order approving the program including the program standards. Among other concerns, the ABA said it appeared the pilot "circumvents the aggregate cap" for member business lending and questioned whether the fund will have "asset enhancements" and how will "risk transfers" be handled. Meanwhile, CUNA Mutual is moving forward now that NCUA has approved the pilot, said Kevin Thompson, vice presisent pf product development for CUNA Mutual's Credit Union Financial Solutions Group. CUNA Mutual will put $25 million towards the fund. One loan has already been purchased and for the time being, the pilot limit is $1 billion. Share sales are expected to come this month.