To the Editor:
I am writing in response to your recent "Perspective" by Bradley E. Rock ["
His rallying cry to the soon-to-be-combined membership of two distinct associations is understandable. He will certainly have his hands full as he tries to manage the interests and diverse needs of these two membership groups. However, to excoriate credit unions for the purposes of inspiring his troops simply rings hollow. He cites two examples of credit unions whose practices we, too, have said are an aberration and certainly aren't indicative of the remarkable work performed each day by thousands of dedicated volunteers and managers on behalf of America's credit union members.
To paint all credit unions with the same brush is to make glib generalizations that simply aren't true.
While there is no doubt that the financial services industry has become more competitive, credit unions' market share has not changed. Credit unions account for merely 6% of all financial institution assets. When margins get squeezed at banks and thrifts, as they currently are at credit unions, it is not credit unions that are the cause, but the economy as a whole and interest rate movements.
Credit unions did not contribute to the bank and thrift crisis of the 1980s, which has had a significant effect on the size of the banking community and cost taxpayers billions, as noted in a recent report by the General Accountability Office. Despite the consolidation of the banking industry, more than 4,500 new banks have been created since 1980 — a phenomenon that has not been duplicated in the credit union community.
Credit unions are in fact more heavily regulated than banks when you consider the restrictions on membership and business lending and the lack of access to capital markets, to name just a few.
However, we do agree with Mr. Rock on the need for regulatory reform. Today financial institutions are under greater scrutiny than ever before. While we champion the government's efforts to improve the financial landscape and enhance the availability of capital and services to consumers, the regulatory burden is indeed becoming onerous.
By putting aside past differences and working together, I am very optimistic that the leaders of the financial services community can construct a "win-win" to address safety-and-soundness concerns and the potential for serving even more consumers. A good first step is to move forward on regulatory relief, benefiting credit union members and bank customers alike.
By doing so, we just might just enhance the availability of financial services to all Americans.
Fred R. Becker Jr.
President
National Association of Federal Credit Unions
Arlington, Va.
