Bankers submitted more than half of the 480-plus letters collected during the 60-day comment period on the National Credit Union Administration's proposal to further ease field-of-membership rules.
More than 150 were identical form letters submitted by bank employees in Florida. They argued that there "is no legal or economic justification for the public to subsidize credit unions that are the size of large banks and offer services that are indistinguishable from commercial financial institutions."
The effects of bankers' unprecedented attempt to influence NCUA policymaking remain to be seen. Chairman Dennis Dollar has insisted in the past that the process is not a public referendum - even though the board has rarely approved measures that are opposed by a clear consensus of credit unions.
Efforts to stuff the ballot box are nothing new at NCUA. Credit union trade groups regularly coach executives on what to include in their comments, which often results in the submission of hundreds of identically worded letters.
The consensus of credit unions in the just-completed comment period was support for the proposal, which would create a new charter known as TIPs (trade, industry, or professional common bonds).
The change would also liberalize standards for community fields of membership; establish automated teller machines as a standard for determining "reasonable proximity" to a potential select group; and eliminate overlap protection from competing credit unions.
The credit unions were almost unanimous in their support of the last item.
"Limiting competition within the credit union world with overlap protection hinders growth and restricts consumer choices," wrote John McGrath, the chairman of Chartway FCU in Virginia Beach.
But a handful of executives opposed scrapping the tradition of limiting competition.
Muriel Blake, the president of Southern Utah Federal Credit Union in St. George, wrote that the provision, combined with the establishment of ATMs as a standard for reasonable proximity, "will effectively allow large credit unions to locate wherever they want to, regardless of current available credit union services in a given area.
"If the long-term goal of the NCUA is to speed the decline of the number of credit unions in the United States, this proposal should be quite effective."
