The Independent Community Bankers of America last week set convincing Congress to reexamine the credit union model, including their tax-exempt status, as one of its priorities for 2017.
And the group accused the NCUA of adopting a role as credit union “cheerleader” rather than regulator.
“The credit union model has become outdated, and its charter, purpose and tax-exempt status should be reviewed by Congress,” the ICBA said in a policy statement announced at the organization’s annual conference in San Antonio. “Credit unions were chartered by Congress to enable people of small means with a ‘common bond’ to pool their resources to meet their basic deposit, savings and borrowing needs.”
The organization identified several other priorities, including the types of regulatory changes being advocated by credit unions.
While some credit unions continue to follow their original mission, many do not, the ICBA said.
As a result, the total assets of federally insured credit unions has grown by almost $70 billion and membership has grown by more than 10 million. At the same time, the ICBA said the number of credit unions has declined by more than 1,000.
“Bank-like credit unions should be subject to the same laws and regulations as banks – including taxation…” the ICBA said. “Large, multi-bond and geographic-based credit unions have exceeded their statutory mission and use their tax-exempt, government-subsidized status to gain competitive advantage over taxpaying community banks.”
The ICBA policy statement goes on to state its opposition to the expansion of credit union field of membership rules, business lending, and their ability to raise supplemental capital.
