With no surprise, the Independent Community Bankers of America (ICBA) announced that concerns about credit unions, especially the tax-exempt status, are among its highest priorities for 2017. The organization accused NCUA of being a “cheerleader” for credit unions, rather than their regulator.the An ICBA policy statement released last week announces . . . The credit union model has become outdated, and its charter, purpose and tax-exempt status should be reviewed by Congress. Credit unions were chartered by Congress to enable people of small means with a ‘common bond’ to pool their resources to meet their basic deposit, savings and borrowing needs. Bank-like credit unions should be subject to the same laws and regulations as banks – including taxation. Large, multi-bond and geographic-based credit unions have exceeded their statutory mission and use their tax-exempt, government-subsidized status to gain competitive advantage over taxpaying community banks.
The ICBA claims that many credit unions no longer follow their original mission, and as a result the total assets of federally insured credit unions has grown by almost $70 billion and membership has grown by more than 10 million. The ICBA policy statement goes on to state its opposition to the expansion of credit union field of membership rules, business lending, and their ability to raise supplemental capital.
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