WASHINGTON (4/21/08)--Credit Union National Association (CUNA) Chairman Tom Dorety isn't happy about the Treasury's blueprint to revise the financial system--and most of all, he's "tired of this idea that there's a new breed of credit unions."
The "new breed" of credit unions refers to a label that bankers use to describe some of the nation's larger credit unions. At a hearing March 6, American Bankers Association Chairman Bradley Rock said expanding the credit union charter, while keeping the tax waiver, would help the "new breed of credit unions" (American Banker April 18).
Rock's testimony made Dorety's blood boil, Dorety told the newspaper.
Bankers argue larger credit unions have abandoned their original mission. But the larger size makes them "no less of a credit union," Dorety told the newspaper. Dorety is CEO of Suncoast Schools FCU, Tampa, Fla., which has $6 billion in assets, making it the seventh-largest in the U.S.
Suncoast has grown because it's successfully provided services to its members, and if credit unions don't grow, "we're going to die," he added.
Dorety's credit union was created by teachers as a non-profit collaborative with a few thousand dollars in assets and a volunteer board of directors. Today, though the credit union's assets have grown, the collaborative status and volunteer board has not changed, Dorety said.
But credit unions "can't just serve people of modest means." While Suncoast has members in low-income areas, it also has branches in wealthier ones, he told the newspaper.
Small credit unions cannot be separated from larger credit unions because they depend on them for help. Requiring them to pay taxes would eliminate the credit union industry, Dorety said.
Credit unions also do a better job than banks lending during a crisis. They are in a position to keep lending, he told the newspaper.
CUNA has lobbied against the Treasury blueprint since it was released March 31. CUNA CEO Dan Mica has spoken against the plan, with his comments appearing in major media outlets such as The New York Times, Associated Press, The Wall Street Journal, The Washington Post and others.
CUNA's Credit Union Magazine also filed an open records request under the Freedom of Information Act to disclose bankers' attempts to affect the Treasury plan in ways intended to put credit unions out of business (News Now April 4).
courtesy of cuna.org