The recent letter from Camden R. Fine, president and CEO of the Independent Community Bankers of America, to Senator Orin Hatch, leaves one to wonder how much more successful our community banks would be if Mr. Fine’s energy was channeled away from attacking credit unions.
Community banks are the backbone of many communities across the country. Without their financial support, many individuals would not have been able to buy their homes and automobiles, many small businesses would not be able to open their stores and factories would not be able to expand their operations.
For many years I lived in a community where I shared a great personal and business relationship with my community bank until a big bank bought them out. They decided to sell not because credit unions were too much competition, but rather because the big guy offered them so much for their stock that by cashing out the shareholders would never have to work again. Unfortunately, many other community banks have followed the same path.
If Mr. Fine would spend more time working with his banks to improve the services they offer, promote the connection they have with their communities, show how they are better than the big banks and shout out their commitment to the people they serve, the success and longevity of the community banks would continue.
Mr. Fine claims modern credit unions have failed in their public mission. On the contrary, they have not only met their mission of helping people find good and reasonable financial services, they have exceeded it by providing those services in areas where no other financial institution exist, as well as to those looking for a better place to do business. He is correct that they do serve everyone who qualifies for membership. They do it so well that everyday people ask “Is there a credit union I can join?”
Mr. Fine claims credit unions are involved in commercial lending. He is right. Not only are they involved, they do it better. They have learned what community banks professed for years: know your customer, take an interest in what they do, maintain contact with them and encourage them to call at any time to ask a question or just to talk. Those principles, along with the ability to analyze whether a venture is a good one or an expansion is warranted, have enabled credit unions to make those loans when some banks will not.
And the tax exemption issue? It’s as solid as the day Congress legislated it. Credit unions are cooperative financial institutions owned by individuals who save with and borrow from them. People helping people, a concept that has made our country great – not a financial institution owned by shareholders who at any time can decide to sell, take the cash and run.
Mr. Fine argues that if credit unions paid taxes we could fund our military, fix our infrastructure, provide funding for our schools and much more. Outstanding! He has found the way to balance our federal and state budgets.
Mr. Fine, you represent some of the finest institutions in our country. But attacking credit unions is not the way to further their growth and ensure their viability. Serving their customers and offering outstanding financial services to them is the way to greater success for community banks. That is what you should encourage them to do.