In what is expected to step up the competition for credit union members between NAFCU and CUNA, NAFCU said Tuesday its board unanimously voted to amend the national trade group’s articles of incorporation to give federally-insured, state-chartered credit unions full membership.

A vote will open to NAFCU’s membership Wednesday and close Sept. 9; if approved, state-chartered NAFCU members would have full voting rights and be eligible to vote on all NAFCU matters, including elections. In addition, full membership would allow state-chartered members to run for and serve on the NAFCU board.

This announcement came while state leagues encouraged their credit unions to remain members of both CUNA and leagues, because in 2017, credit unions will have the choice to decide whether to join CUNA, their state leagues or both organizations.

Last week, for example, CUNA and the League of Southeastern Credit Unions launched a new website, CUstrong.com, as part of a strategic membership and messaging campaign to drive home the benefits of credit unions maintaining their membership with CUNA and the Southeastern league.

In March, after a fierce, months-long, industrywide debate, more than 90% of CUNA’s members voted in favor of historic bylaw changes that included eliminating the dual membership requirement.

The membership optionality now frees credit unions to keep their state league membership and join either NAFCU or CUNA. However, many credit unions may not be able to afford to join both national organizations, which is expected to create competition for members between CUNA and NAFCU.

Dave Adams, president/CEO of the Michigan Credit Union League, said while some may view competition between NAFCU and CUNA to be a good thing, he fears it will only fracture the credit union movement. “Why not have three or four [national associations], because if competition is so good, it ought to be really good to have lots of national associations,” Adams said. “The problem is that in the association world, it doesn’t work that way in any industry, and the reality is that multiple national associations cause those national associations to compete against each other, and by design it fractures the message. When you divide the industry with fractured, diverse messages, it affects your ability to be effective as an industry.”

NAFCU, however, said it is very common in Washington for industries to have several trade associations, pointing out that the banking and insurance industries have multiple national associations.

In reaction to the NAFCU board’s decision, Ohio Credit Union League President/CEO Paul Mercer said he thinks NAFCU should do whatever it thinks is right.

“The Ohio League is focused on building strength through a three-tier system of unity, advocacy and support that CUNA and the leagues bring to every credit union in every corner of America,” Mercer said. “Together we catalyze success for all credit unions, as we always have. Jim Nussle has CUNA beautifully positioned.”

Adams said he has heard some credit union leaders say for some time that the movement shouldn’t have more than one national trade group with one united front.

Ed Templeton, a former NAFCU chair who recently retired as president/CEO of the $777 million SRP Federal Credit Union in North Augusta, Ga., said in an interview with CU Times earlier this year that he likes having two national trade organizations representing the credit union movement.

“I like being represented by two organizations in D.C. because I like that one can work one side of the aisle and one can work the other side of the aisle,” Templeton said. “We’re on the same page, but we have different skill sets, different abilities, different strengths, different weaknesses. So each has a role to play.”

While CUNA and NAFCU may each have a role to play, the relationship between the two organizations has soured.

In March, Templeton said he and the NAFCU board were not happy with a decision by the executive committee of CUNA’s board to cancel a meeting with the executive committee of NAFCU’s board at the 2016 Governmental Affairs Conference – a longstanding gathering for the nation’s two national credit union trade organizations.

According to Templeton, Susan Streifel, former CUNA board chair and president/CEO of the $95 million Woodstone Credit Union in Federal Way, Wash., canceled the GAC meeting because she said the CUNA executive committee would be too busy and that it was no longer getting any valuable takeaways from the meeting.

Richard L. Harris, NAFCU board chair and president/CEO of the $1.4 billion CalTech Federal Credit Union in La Canada, Calif., said the trade group announcement to give full membership to state-chartered credit unions is a natural evolution of NAFCU’s mission and supports the organization’s goal to help all federally-insured credit unions.

“As NAFCU continues to grow, state-chartered members should have an equal vote and seat at the table, for the benefit of our membership and the industry,” Harris said. “One member – one vote.”

For nearly half a century, NAFCU said in its prepared statement that it is the only national trade organization that exclusively focuses on federal issues affecting federal credit unions nationwide and advocates on their members’ behalf before key policymakers and regulators in Washington, including Congress, the NCUA and the CFPB.

“If our membership votes in favor of the board’s unanimous recommendation, NAFCU member credit unions would benefit from an even stronger and more influential partner in Washington, D.C.,” NAFCU President/CEO Dan Berger said. “This change would strengthen the voice of all NAFCU member credit unions and our industry at the federal level.”

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NAFCU Board OKs Full Membership for State-Chartered CUs

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