WICHITA, Kan. – Kansas’ bankers are hailing passage of a bill in the state Senate that limits growth opportunities for state-chartered CUs.
A spokesperson for the Kansas Bankers Association said legislators have come to realize that credit unions are abusing common bond, saying some have been claiming all of Kansas as a “neighborhood.”
“We don’t have a problem with a credit union that says we’re going to have state employees be our common bond group, and they could have state employees in all 105 counties,” the spokesperson said. “... Where we have a problem is when they say the common bond is the entire geography of the state. Our issue is when that credit union applies to the department and says, ‘Hey, we want to serve people that are affiliated with the university, plus give us 20 counties,” Wareham said as an example. “They’re combining occupational or association groups.”
The bill passed the Senate after the Kansas Credit Union Association agreed to a compromise on an amendment to the Senate bill that will impose stronger restrictions on branching out of credit unions, while still allowing some leeway in expanding their territories. The bill is headed to the House.
