Calif. CUs Play Up Dissappearance of Community Banks
This state's credit unions said they brought a "more aggressive" message to legislators here last week as part of the league's Government Relations Rally.
The fundamental message: because of the massive acquisition of community banks by multi-state banking conglomerates, credit unions are one of the only locally owned depository institutions left in California and need to provide more services to help Californians build savings, own homes, and develop small businesses.
"California's credit unions are no longer playing defense against the banking industry but are instead moving forward with a positive agenda," said California Credit Union League CEO David L. Chatfield. "We are now the primary financial institutions for one out of every five Californians. As bank holding companies continue to buy up successful community banks, the role of credit unions in the local economy must evolve to fill the void and meet the needs of California's communities."
According to the league, acquisitions have driven community banks' market share from 30% in 1992 to a mere 13% last year, "leaving communities to increasingly rely on locally owned credit unions to spur development."
Chatfield added that the 150 credit union leaders who were on hand for the Rally were well aware of what their rival bankers were saying about them.
"The fable they will tell in Sacramento is that the modest growth of credit unions is somehow damaging helpless community banks, " he said. "The truth is that multi-state bank holding companies have grown from 41% of the market in 1984 to 71% in 2004 -while credit union market share during the same period remained almost flat, at just under 10%."
During their meetings with legislators last week, credit unions lobbied for support of S.B. 1292, sponsored by state Sen. Joe Dunn (D-Garden Grove), which would give credit unions greater ability to provide lower-income Californians with services like check cashing, money orders, and money transfer services to families in other countries.