There's so much happening, this week I offer a potpourri of analysis of recent credit union events.
-New Breed...So What? I give the bankers credit, they have been consistent. Their soundbites today sound like their soundbites from last year and the year before. That's very smart. They're trying to drive home a message, have it resonate with Congress. Problem is their soundbites are off base.
Take the recent GAO report that found banks are thriving, even while they push for Congress to repeal the credit union tax-exemption. In a good PR move, the banks have tried to turn the banking industry into the have and have nots. An ABA spokesman said the GAO report doesn't highlight that many banks under $100 million are losing money. That would be a good strategy, except the same exact thing is happening with credit unions. Many credit unions under $100 million are losing money. What's the point? It's called
market factors, it's why there is consolidation in
The banker also goes on to talk about this "new breed of credit unions." Now that's a soundbite we've all heard. Again, so what? Have banks not changed? Of course they have. Credit unions shouldn't? A tax-exemption doesn't mean you can't evolve. Once again the bottomline is this, if the grass is so much greener on the credit union side, why don't bankers convert? We'd all welcome them. I am sure credit unions would even help them with their conversion process. Heck, there aren't any new credit unions being formed, so let's save some of these poor banks that are being crushed because of the tax-exemption. Come on over!
-Everyone in Everyone Else's Business. Trying to keep up with who does what is increasingly challenging. Last week CO-OP Financial Services, best know for its nationwide surcharge-free ATM network, said it plans on getting into card processing. Also last week it came to light that Fidelity Information Systems, itself a card processor, has purchased AssetExchange, one of the leading card portfolio brokers. So soon you'll be able to process with CO-OP and sell your portfolio with FIS. Speaking of CO-OP it has signed a deal with Costco to provide surcharge-free ATM access at 350 Costco stores. CO-OP already has a deal with 7-Eleven, as does rival shared branching firm FSCC. Both firms do a lot of similar things and a lot of different things, but given their geography and focus, could they bring more value to the market
as one entity?
More news on 7-Eleven and ATMs. Cardtronics, the largest independent deployer of ATMs, is buying the ATM operations of 7-Eleven. Don't look away or you might miss another ATM deal.
-Lagging League Affiliation. I give New York State League CEO Bill Mellin a lot of credit for highlighting an issue that can be sensitive for a league president. In his recent president's message to league members, Mellin noted that while the league has 375 members, 140 New York credit unions have elected not to belong to the league. Mellin offered up reasons why CUs might not belong to the league, such as budget constraints, but threw the ball back to his league members for help. Mellin asked his members what the league should do to try and bring more CUs into the fold. He also asked this very difficult question: "Should we look for ways to involve them or should we shun them?"
This has come up with other leagues. How should a league handle credit unions who don't belong to the league, but like to cherry pick different products or events? How much higher should they be charged? Should they even be allowed to cherry pick? Shunning never makes sense to me. Forcing someone into things doesn't work over the long haul. At the same time, leagues shouldn't be afraid to make pricing differences substantial between nonmembers and members. Members support the organizations, they deserve the benefits. But it's incumbent on leagues to continue to show value, and Mellin has the right idea, have other credit unions in the state work to bring nonmembers into the fold. But I can't blame nonmembers who don't join because they don't see enough action from a league, enough representation on state law, enough branding efforts, enough compliance support, etc. What is disappointing is the many credit unions that don't join leagues because of politics or personal disputes, and we all know that
plays into many situations. Kudos to Mellin for keeping the heat on.
-Giving Back. I am continually amazed by the generosity of credit unions. Readers who turn to the In Other News section of this issue and any issue will find credit unions doing all sorts of good things in the community and donating money to good causes. I see so many of these releases each week. A thousand dollars here, ten thousand dollars here. Credit unions are giving back so much to the communities they serve, but does anyone know? It's the duty of marketing and PR professionals to tell this giving back story as much as they can. There's no better story to tell.
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