Expressing concern over a call for a foreclosure moratorium and a state-run bank, the Michigan Credit Union League is jumping into the race for governor with an endorsement for the GOP candidate, Rick Snyder.
In a statement, the league said that after meeting with Snyder and his Democratic challenger, Lansing Mayor Virgil Bernero, it supports Snyder. The league expressed alarm over Bernero's proposals for a statewide halt to foreclosures which would have "a chilling effect on credit unions" and their ability to lend.
Bernero's call to pull Michigan's investments out of Wall Street banks and open a new state-run Main Street Bank would also be harmful, the MCUL said.
"Credit union leaders, who represent main street financial institutions, believe that Michigan's next governor should carefully limit the role of government in the financial sector," said David Adams, the league's president/CEO, in a statement that stressed that CUs "and other lenders have been battered by economic conditions and additional government regulations."
CUs, he said, "are finding it difficult to lend in this environment" and so "our next governor will need to help all main street financial institutions get stronger in order to unfreeze credit markets. Rick Snyder has the leadership skills and market understanding to achieve that."
Late polls show Snyder, an Ann Arbor businessman, with a 20% lead over Bernero, who in a gubernatorial debate last week said the freeze on foreclosures at three major banks, Ally Financial Inc.'s GMAC Mortgage unit, Bank of America Corp. and JPMorgan Chase & Co., should be extended to Michigan.
Snyder countered he thought a blanket foreclosure moratorium would only worsen the economic downturn, making it even harder to create jobs. He said banks need to be held accountable for wrongdoing, however. The three banks identified halted foreclosures in 23 states after evidence surfaced that their employees or outside lawyers signed documents without reading them or filed inaccurate paperwork.
The Michigan League noted that "Congress has passed sweeping reforms for Wall Street lenders, but little has been done to help main street lenders like credit unions do what they do best- end and serve."
Many things, the league said, "are necessary to bring Michigan's economy back and to create jobs" with access to capital from local lenders a key factor for a revitalized Michigan economy.
The state has the second-highest unemployment rate in the country, 13.1%.