When Technology Credit Union posted its announcement that it wasexploring a conversion to a mutual savings bank, CUNA and theCalifornia Credit Union League made some noise. CUNA CEO BillCheney said his organization feels credit unions are the bestproviders of service to consumers.

They can be but not always. Credit unions used to their fullestpotential are amazing entities hands down. If a credit union isn'toffering products or services that the members want because it'srestricted in capital building–as Tech CU said in its letter tomembers–then that's a real problem for the business and how andwhether it can continue serving its members.

If Tech CU members really want business loans, which the creditunion cited as another reason to convert, but the credit union runsup quickly on that 12.25% cap, then Tech CU could be doing theright thing by its members.

The credit union community must drop its preconceived notion asthe only way to truly serve consumers well. If that were the case,banks would be the ones controlling just 6% of the market.

Tech CU's disclosure was very boilerplate, and the credit uniondid not return Credit Union Times' call for furthercomment. The disclosure noted that a conversion to a mutual savingsbank would mean that members would still have voting rights, whichthe trades did not acknowledge in their statements. However, italso didn't mention that those voting rights are often based upondeposits. One dollar, one vote to play off the credit union onemember, one vote philosophy.

Neither Cheney nor CCUL President/CEO Diana Dykstra accused thecredit union board or management of converting out of greed.However, the CCUL's statement jumped Tech CU straight to astock-held institution serving the interests of stockholders, whichTech CU clearly said it didn't have plans to go beyond the mutualbank charter at this point. It may (22 of the 35 that haveconverted are stock form plus five are hybrid models, according toCU Financial), but the possible stock conversion cannot bea foregone conclusion.

The membership gets plenty of disclosures and the ultimate vote.It is, after all, their institution. If they decide a bank charteris best, that's their call. If the credit union ultimately convertsto a stock charter, that also is the MSB members' call.

No good can come from keeping a credit union acredit union if it does not want to be one. In reality, creditunions have not cornered the market as the only good option forconsumers.

The trades hate when banks try to define credit unions but, whena credit union tries to redefine itself, they hate that, too. Notethat NAFCU has remained completely silent on this matter. Smartmove.

Cheney went so far as to draw a parallel to the BofA debit feecontroversy. “That point [that consumers are best served by creditunions] was made acutely over the last several days when Bank ofAmerica announced a monthly debit card fee–which was followed by aresounding and sharp outcry from across the nation by consumers andthe news media alike that credit union membership is the naturalhaven from such high fees, typically charged by banks.”

The trades should turn the conversion scenario around and tellmembers of Congress, “Look how difficult our charter is to operatein. We need capital reform and expanded business lendingauthorities.”

In a capitalist society, with acutely targeted reining in by thegovernment, I find it unfathomable that Americans raise such anoutcry over the $5 fee. A for-profit institution, cut off from onerevenue stream by the Durbin amendment, will naturally seek outanother.

BofA would be in violation of its fiduciary duty to itsstockholders. Seeking replacement revenue is not a sin. Howmuch has any bank or credit union lost in data breaches or paid ininfrastructure that was previously covered by interchange fees?

Sen. Durbin was reportedly “outraged” by the BofA fee. That'soutrageous. The entire industry (never mind common sense) said thiswas coming. President Obama declared that this is exactly why theConsumer Financial Protection Bureau was necessary. Dodd-Frank,which created the CFPB, also imposed the interchange cap that ledBofA to establish the fee.

The Consumers Union has even called for an investigation intothe fee. What do they expect to find? It is not a crime to charge arelatively nominal fee to cover the cost of a serviceprovided.

The world needs all kinds of financial institutions. Consumerscan vote with their money if they really don't like the one they'reat. Credit unions must take advantage of the buzz the BofAannouncement has stirred up. Give consumers the tools and knowledgeto actually make the move to a credit union.