The Nov. 24, 2015 article in the Credit Union Journal about the reaction of Camden R. Fine, President and CEO of the Independent Community Bankers Association (ICBA) to the NCUA's proposed changes to its field of membership (FOM) regulation is evidence of the frustration the banking community has over the continued success of the member owned, cooperative financial network of credit unions.
The threat to "litigate if NCUA doesn't back off" rather than recommit the effort of the banking community to better serve their customers and make their institution the better option, leaves one to wonder who the ICBA is more concerned about; their shareholders or the depositors who built that institution.
The proposed FOM regulation is well within the parameters of the law. In fact, some believe NCUA could go further in opening up the fields and giving access to credit unions to a greater number of individuals across the country. It's clear that the ICBA along with the American Bankers Association (ABA) continue to be fearful of the growing discontent of their customers over access to loans, saving rates and lack of individual service. They sense the growing popularity of credit unions, the desire of individuals for the personal service credit unions are known for and the opportunity to be an owner of the institution that provides for their financial needs. Those factors can only spell additional challenges for the banking industry.
I would ask that the NCUA Board not in any way be coerced by the threat of litigation and fail to provide membership access to as many individuals as possible within the confines of the Credit Union Act. I would urge they push the envelope as far as they legally can to allow as many as those that want to be credit union members and owners. And if the ICBA wants to challenge the FOM regulation in a court of law, let them bring it on. Who wouldn't love to hear the argument made to a jury as to why someone, living in the United States of America, should not be allowed to join a credit union.
It is unfortunate that the ICBA and ABA has not joined forces with NAFCU and CUNA to work together in Congress to effect changes that would benefit all financial providers. There are numerous changes that should be made to Dodd-Frank, the Consumer Financial Protection Bureau and federal regulatory agencies that would help banks and credit unions do their jobs better.
Perhaps the best statement attributed to Mr. Fine and one which I agree with is "Why not just say all credit unions can serve all people anywhere." Excellent idea, Mr. Fine, and I would just add "and may the best team win."
Michael Fryzel is a former NCUA Board chairman and is currently an attorney in Chicago.
