The tension between the banking industry and the credit union industry is as palpable as ever, with the Senate poised to vote on a bill to expand the authority of credit unions to make business loans.
The Minnesota Bankers Association has its annual Washington D.C. trip scheduled for this week, and the bankers that make the trip will surely make the case that credit unions should not be permitted to make more business loans. That will be a tough case to make at Sen. Al Franken’s office; Franken is a co-sponsor on S. 2231, the bill to expand the credit unions’ lending power. Finance and Commerce has this article on the issue.
The Independent Community Bankers of America is hosting its Washington Summit this week, with hundreds of bankers expected to participate, including dozens from the Upper Midwest. They also will meet with elected officials to discuss the credit union issue, in addition to other issues.
In Minnesota, the credit unions have further poisoned the air with a recent campaign to encourage consumers to post stories on a facebook page about their bad experiences at banks. This Start Tribune article describes the campaign, which will award prizes up to $2,000 to consumers who post bank bashing stories.
There have been campaigns in the past where individual credit unions have bashed banks, but this is the first time I can remember that the entire industry getting behind such a smear campaign. MBA President/CEO Joe Witt wrote this letter to the Minnesota Department of Commerce to complain.
Surely, most credit unions are managed by people who believe they can best make their case by promoting their advantages rather than by stirring up ill feelings about the competition. I wonder if in the long run this campaign might not backfire.
This is bank-bash contest thing not unique: http://thefinancialbrand.com/18248/elevations-credit-union-limerick-promotion/
For anyone buying that this CU industry is non-profit, I have a free lunch to sell.
CU’s are just like Banks…on steroids.
If CU’s want to be banks let them be taxed like banks.
I don’t think there’s a banker in America that would have a problem with that.
CU’s wouldn’t then talk so loud.
As it is Banks – and the rest of America – are nothing less than subsidizing these CU’s.
When government writes rules that takes market share from tax paying citizens and gives that market share to non-tax paying citizens it doesn’t take long for the public coffers to slip into the red.
And we wonder why we can’t pay our country’s bills!
Still it is our own fault as Bankers for not getting the facts out there.
It’s just that tax-free status – that merchants’ holy grail – is so powerful (read: corrupt) it’s a very tough nut to crack.
“Do tax-cheat credit union bosses make you ill?
Does their “fat-cat banker” rhetoric sound shrill?
Then bank within your community
And attack fraud with impunity
Because it’s YOU getting stuck with the bill!”