With credit union executives in Washington to advocate for their tax-exempt industry amid a recent surge in acquisitions of taxpaying community banks, ICBA this week launched several campaigns to raise important questions among lawmakers about questionable and outdated credit union policies.
Advocacy Campaigns: ICBA is running simultaneous campaigns to ensure lawmakers get the facts about how the credit union tax exemption and lax oversight by the National Credit Union Administration pose harm to local communities.
- “Something’s Wrong” Campaign: As part of ICBA’s ongoing series of digital campaigns on credit unions, ICBA this week launched new targeted ads and a website making clear to consumers that “Something’s Wrong” with credit union policy. This new campaign targeting constituents in key states spells out the cost and impact of the credit union tax exemption and directs consumers to a grassroots advocacy message they can send their representatives in Washington.
- Questions for Credit Union Execs: And as credit union executives meet with members of Congress this week as part of the National Association of Federally-Insured Credit Unions' annual fly-in, ICBA is blanketing congressional offices with questions they should ask the industry representatives. In a series of ads targeting Capitol Hill, ICBA is urging lawmakers to question attendees on the credit union industry’s founding mission, tax and regulatory exemptions, acquisitions of taxpaying community banks, and more.
- FDIC Meeting: ICBA staff also met this week with FDIC Vice Chairman Travis Hill to discuss the surge in acquisitions. During the meeting, ICBA cited the growth of this troubling trend in recent years and ICBA’s ongoing opposition.
- Grassroots Resources: Meanwhile, community bankers can continue to use ICBA’s Be Heard grassroots action center to call on their members of Congress to hold a hearing on the NCUA’s lax oversight. Additional resources—including fact sheets detailing the state-by-state impact of the credit union tax exemption, a messaging playbook and ICBA white papers, and a customizable op-ed and talking points—are available on the ICBA website.
Rakuten Charter Application: These efforts come amid a flurry of credit union activity. After ICBA last week submitted a Freedom of Information Act request with the NCUA seeking information on whether Rakuten Inc. has applied for a credit union charter, the agency has reportedly confirmed that the “Amazon of Japan” earlier this year filed an application that it withdrew last week. Unlike federal banking regulators, the NCUA does not maintain public databases of organizations and entities that have applied for federal insurance or a national charter, so ICBA requested details following Rakuten’s repeated applications for FDIC deposit insurance as an industrial loan company.
Surge in Credit Union Bank Acquisitions: ICBA has also been speaking out as the disturbing trend of credit union acquisitions of community banks has reignited with a series of new deals, including five announced acquisitions in a single week. In a recent national news release, ICBA noted that nearly 20% of this year’s bank deals are now credit union bank purchases, and we reiterated our calls for Congress to hold hearings on the trend, request a Government Accountability Office study on the credit union industry, and consider an “exit fee” on these taxpayer-subsidized acquisitions.
Outlook: While ICBA’s affiliated community banking associations in states such as Minnesota, Mississippi, and Nebraska have achieved notable successes against credit union overreach, our nation’s flawed and outdated credit union policies demand a federal response. ICBA will continue raising a red flag on these failed policies and demanding that Congress respond with meaningful policy changes.
Thank you, community bankers, for all your efforts to address misguided credit union policies. Only by constant diligence and active outreach can we ensure Washington wakes up to the credit union problem, recognizes that something is wrong, and ensures taxpayer funds aren’t used to underwrite financial services consolidation.
