Executives at state banking trade groups are banding together to do battle with the credit union lobby and other nonbank interests.
Fed up with what they see as divisive political posturing among the national banking trade associations, several state groups are forming a coalition dedicated to bringing equal taxation and regulation on the not- for-profit credit union competition.
The group, called the Community Bankers Action Alliance, also has its sights on the federal Farm Credit System, insurance companies, and brokerage firms, which are perceived as having a competitive advantage over banks because of regulatory inconsistencies.
The state-level activists, led by Frank Pinto of Pennsylvania, say the situation is so dire that they must make a break from the national groups with which they have at least loose political affiliations: the American Bankers Association, Independent Bankers Association of America, and America's Community Bankers. "We don't want to make it seem as though we're crying, but fairness dictates that something be done - and something be done now," said Mr. Pinto, executive director of Pennsylvania Association of Community Bankers.
"We need to harness our energies against all these unregulated entities who are not only out for our lunch, but our supper, too."
Mark R. Wolff, vice president of public affairs for the Credit Union National Association in Washington, said his group is formulating a response.
"We've made a request to the other credit union organizations to join together and provide a unified defense against the bankers' tactics," he said. "We feel the need to retaliate in kind.
"We are working on getting more credit union delegates to Washington to meet with members of Congress and their staffs, and explain why credit unions are unique, and demonstrate the many ways they help the American consumer," Mr. Wolff added.
The three national banking associations have long voiced concerns about an "unlevel playing field." But critics say they have not been able to coordinate their efforts because of other pressing issues. Some theorize that an umbrella group could overcome inter-association politics.
"If the nationals can't get together, and it doesn't appear that the nationals can, it's time for us to act and take a leadership role," Mr. Pinto said.
Kenneth A. Guenther, executive vice president of the Washington-based Independent Bankers Association of America, said he is aware of the proposed alliance, but does not think it will carry much weight.
"It's going to take a major and sustained grass roots effort to get this going," he said. "I wish it were that simple - that you just hire a new lobbyist and suddenly there's a new political climate. But it's not.
"I don't know that there's any real support for the idea at the grass roots level."
The alliance wants to focus on educating the public and lawmakers, with the ultimate objective being to equalize regulation.
"The time is now for those credit unions to pay in order to play, and to play by the same rules," said Thad Woodard, president of the Community Bankers Association of North Carolina. "This is something that's going to take a united effort by the national trade associations to accomplish."
The alliance would target brokerage firms and insurance companies as well, but would probably focus most of its efforts for credit unions, Mr. Pinto said. The group would even attack specific institutions that have grown well beyond their initial "common bond" and would barrage recalcitrant lawmakers or legislative committees with information.
Currently, about 15 to 20 state affiliates of the Independent Bankers Association and America's Community Bankers have expressed interest in the coalition. Mr. Pinto expects about 30 state associations eventually to join. The alliance is also hoping to draw several thousand individual bank supporters to counter credit unions' success in mobilizing large numbers of members for support on key issues.
R. Kevin Dietrich contributed to this article.
