FDIC Chairman Repeats Call For CU Taxation

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The banking regulators continued their assault on credit unions last week, with FDIC Chairman Donald Powell telling the Independent Community Bankers Association of America that credit unions should be taxed.

Powell, a former banker, had just one week earlier told a gathering of America's Community Bankers the very same thing.

Powell's words raise several issues, such as whether it is proper for one regulator to be acting as a cheerleader for the entities it regulates and publicly bashing the competitors of those entities.

Haven't the bankers long complained about NCUA being a cheerleader for the industry? How would it be for NCUA Chairman Dennis Dollar going around bashing banks for their involvement in the ongoing mutual fund scandals?

But Powell's remarks are also at odds with the publicly stated policy of the Bush Administration, for which Powell works. Treasury Secretary John Snow has laid out that policy in recent weeks, first to CUNA, then before the bankers at the ACB conference. That is preservation of the credit union tax exemption.

Powell, of course, is the former Chairman and CEO of Boatmen's First National Bank, in Amarillo, Texas.

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