The NCUA's proposed cap and limit on credit union purchase of loan participations would hurt credit unions' abilities to lend and effectively minimize their ability to limit risk, according to a recent CUNA comment on the proposed regulation.
The Feb. 16 comment made the point that the agency did not appear to look to other financial regulatory agencies for examples of how they manage risks in loan participations.
"This approach of setting a regulatory limit on loan participations from one originator seems to be unique within the financial system, as we did not identify a similar restriction on bank loan participations," the association asserted. "Since there does not seem to be a greater risk within the credit union system regarding loan participations than there is for banks, this proposed limitation would arbitrarily disadvantage credit union loan participation programs."
Complete your profile to continue reading and get FREE access to CUTimes.com, part of your ALM digital membership.
Your access to unlimited CUTimes.com content isn’t changing.
Once you are an ALM digital member, you’ll receive:
- Critical CUTimes.com information including comprehensive product and service provider listings via the Marketplace Directory, CU Careers, resources from industry leaders, webcasts, and breaking news, analysis and more with our informative Newsletters.
- Exclusive discounts on ALM and CU Times events.
- Access to other award-winning ALM websites including Law.com and GlobeSt.com.
Already have an account? Sign In
© 2024 ALM Global, LLC, All Rights Reserved. Request academic re-use from www.copyright.com. All other uses, submit a request to [email protected]. For more information visit Asset & Logo Licensing.
