Supreme Court Delivers a Huge Win for the Credit Union Movement with Denial of Banks’ Appeal on Field of Membership

Former NCUA Chair Rick Metsger weighs in on the importance of this development.

Former NCUA Chair, Rick Metsger.

06/30/2020

Editor’s Note: The Credit Union Movement celebrated a win Monday, when the U.S. Supreme Court decided not to hear an appeal of the National Credit Union Administration’s Field of Membership Rule — an appeal filed by the bank lobby. In this special to Anthem, Oregonian and former NCUA Chair, Rick Metsger, shares his perspective on the Supreme Court’s decision. 

The U.S. Supreme Court on Monday declined to review an Appeals Court ruling that upheld the NCUA’s sweeping changes to credit union Field of Membership regulations. The action ends the nearly four-year challenge by the American Bankers Association to the changes we enacted in 2016 during my term as Chairman of NCUA.

This marks a significant victory for consumers who will have greater access to not-for-profit financial services.

The new rules expanded outreach by credit unions to consumers in over a dozen different areas, most notably by expanding the definition of rural districts and local communities. It was those two provisions which the A.B.A. asserted the NCUA had exceeded its statutory authority.

Credit unions can now confidently and fully explore utilizing the new regulations to address the financial needs of their communities. The expansion of the rural district definition means credit unions can serve such a district with a population up to one million people. The previous limitation was 250,000.

Above all, the ruling validates the role of the NCUA to reasonably interpret local communities and rural districts where Congress has given the Agency specific authority to do so.

Policy and legal teams at NCUA worked diligently to craft the regulations to withstand such a challenge and to meet its mission of providing affordable credit to American consumers.

The ruling also strengthens the federal charter, particularly in the West and Midwest regions of the country where rural districts can often cross multiple state borders.

The NCUA has announced it will immediately begin to process applications under the new rules.

Editor’s note: Rick Metsger has returned to the Pacific Northwest. Through a partnership with Strategic Link, he is available for speaking engagements, strategic planning sessions for credit unions, and strategic training for credit union boards. More information on his services can be found here.

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