Per the article in CU Today, the ABA is objecting to the proposed NCUA regulation that would raise the appraisal threshold for commercial real estate transactions.
ABA has distributed their complaint to key Hill Committee staff and other financial regulators.
We believe NCUA is on solid ground here. The credit union safety and soundness experience in this area is good, especially when compared to banks. At the NCUA Board meeting when the rule was first proposed, the Agency took pains to examine the track record and found sufficient justification to raise the level to $1 million.
On the other hand, it is entirely possible that the ABA is unhappy that their regulators came to a different conclusion, and only raised their threshold to $500,000 based on concerns about past problems that the banks experienced with commercial real estate loans. The statute gives all financial regulators that discretion.
The comment period for the NCUA proposal closed December 3.