First, I'd like to mention that I absolutely love reading The Credit Union Journal. I find it to be one of the most relevant periodicals that I read, and I often find ideas within The Journal that we work to implement to increase our services for our members.
The reason I am writing is to comment on the story, "Analysis: Banks
'Wasting Time' On Credit Unions," by Michelle Heller and Barbara A. Rehm (CU Journal, June 14). I found the story very interesting and couldn't help but chuckle about the "quixotic" battle that banks are waging against the CU industry. I understand the reason for banks being so intimidated by the CU industry, but what I don't understand is why banks don't just become credit unions if we have it so good! I mean, the bank could just liquidate some capital and purchase back their stock to revert their charter. Of course, they would not maintain their current capital base, they would have to give up their ability to generate revenue in investments much riskier (and higher yielding) than CDs, the board and management would have to give up their options and the controlling stock holders would have to give up their weighted votes in exchange for one vote just like all the rest of the customers. They should have no problem with the process.
The sad part is that banks neglect to see that they succeed in generating massive profits and squeezing credit unions is only going to cause more of us to eyeball conversion as a way to survive. Imagine banks having to compete against credit unions on "even ground!" A new generation of bank barons would be born!
Hmm...maybe taxation wouldn't be such a bad thing...I could use some stock options!
John T. Kmetz III, Mercury Launch Project Manager
Community Credit Union of New Milford, Inc., Connecticut
