Pewaukee, Wis. – One way to tell a piece of proposed legislation is suspect is when it’s introduced at the last minute, under cover of darkness, and without notice to any of the people who will be affected by it. That is exactly what happened with the legislation supported by the Coalition for Credit Union Charter Options (CCUCO), an out-of-state group dedicated to eliminating the competition that credit unions—member-owned, not-for-profit financial cooperatives—provide to for-profit banks.
“The group’s claim that it’s somehow better for Wisconsin credit unions to have faster, easier path to becoming a bank is irresponsible and misleading,” said Brett Thompson, president and CEO of the Wisconsin Credit Union League, which represents Wisconsin’s 220 credit unions. “This effort to eliminate credit unions under the guise of greater operational flexibility is being driven by the banking industry, which has been trying for decades to legislate, regulate and litigate credit unions out of business.”
Especially disingenuous is the group’s claim that if a credit union becomes a bank it could make more loans, accept more deposits, and open more branches. “Never in history have banks been in favor of credit unions making more loans, accepting more deposits and opening more branches,” said Thompson. “In fact, they’ve sued credit unions and lobbied Congress and the state legislature to keep them from doing just that. This legislation has nothing to do with serving the public. It’s about just the opposite—quelling competition so banks can make even more money.”
Equally misleading is the group’s statement that credit unions that convert would help the state by paying more in taxes. “The annual member benefits that credit unions deliver to Wisconsin citizens far outweigh the potential tax revenue,” Thompson emphasized.
Last year alone, credit unions returned almost $203 million dollars to their member-owners in Wisconsin—in the form of lower rates on loans, higher rates on deposits, and fewer and lower fees.
“This legislation is really about bankers looking for a way to make even bigger bank profits. Public policy should protect credit union members’ right to determine the future of the financial institutions they own. Passing legislation—secretly, without public notice, debate or hearing—that makes it easier to turn the equity of Wisconsin’s 2.2 million credit union members into additional riches for a few bank shareholders cannot in any way be considered in the public interest,” Thompson added.