`Crescendo" of Banker Attacks Can Abate, Forecasts America First's Craig
COLORADO SPRINGS, Colo. - Credit unions are making headway in fending off banker attacks, and provided they keep up their guard, the attack "crescendo" could lessen in a year and a half once the term of an incoming American Bankers Association chairman - and CU nemesis - ends. That assessment...
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COLORADO SPRINGS, Colo. – Credit unions are making headway in fending off banker attacks, and provided they keep up their guard, the attack “crescendo” could lessen in a year and a half once the term of an incoming American Bankers Association chairman – and CU nemesis – ends. That assessment was put forward here by Rick Craig, a veteran of Utah’s bank-CU clash as president and CEO of that state’s largest CU, the $2.6 billion America First FCU, of Riverdale, Utah. Suggesting that CUs continue to bolster political action programs at both the state and federal levels, Craig offered what he said was a more optimistic view that the industry can withstand the banker onslaught because the CU campaign is gaining public support. Witness to that, he said, are the favorable comments earlier this month by U.S. Sen. Richard Shelby ( R-Ala.), chairman of the Senate Banking Committee, who said CUs should not be taxed because such a step would hurt the public with members ending up paying taxes. In a weekend speech to the annual meeting of the Colorado Credit Union League here, the America First CEO argued that CUs have become “galvanized” in recent months to go head-to-head with the banking lobby but that still more needs to be done to ensure that CUs “are feared” rather than just “liked.” As part of the galvanizing process, he said, the CU leadership has strengthened the political apparatus within state leagues – hiring political veterans to senior posts – reinvigorating advocacy groups, meeting more frequently with lawmakers and sharpening anti-bank media ads, contended Craig. Regarding League staffing, he pointed to the hiring three months ago in Colorado of a former top gubernatorial aide, John C. Dill, to head the Colorado League and in his own state, where the former executive director of the Utah Republican Party now is CEO of that League. Despite this progress, the Utah CU leader warned the industry is in for continued rough treatment from elements within the ABA led by a Utahan Harris Simmons, chairman of Zions Bank of Salt Lake City and the incoming chairman-elect of the ABA. In a speech last December before a CUES conference in Las Vegas with comments repeated here, Craig suggested the ABA’s CU attack agenda on taxes and field of membership was orchestrated by Simmons whose term would continue into 2005 but after that there are hopeful signs the anti-CU campaign could lose some of its steam. Craig has argued that Simmons maintains a vendetta against CUs in his state, but the campaign has already backfired with some Utah lawmakers lamenting their mistakes in enacting last year a harsh anti-CU bill which nearly imposed a first-time tax on large Utah CUs. The prospect of a tax triggered a flight of some 11 Utah CUs – including some of the state’s largest – to convert to a federal charter, consequently depriving Utah of needed revenue. Though the tax portion was eliminated, the Utah legislature did impose a ban on business lending for large institutions and severely restricted business loans for others. Once there is a “culmination” to Simmons term at its end in 2005-2006, CUs “will be much better off,” Craig predicted in an interview. In his formal remarks to the Colorado League convention, Craig warned CU executives that “sooner or later you will be involved” in bank attacks. Colorado so far has been spared any major skirmishes with bankers unlike neighboring Utah or New Mexico. The Utah CEO urged Colorado CUs to get make sure their political-funding apparatus is in good shape to fight banker attacks because “don’t think for a minute right will prevail.” He said CUs need to make sure a sound legislative strategy is developed “so that we have friends and key people on the side of credit unions.” As he did in his CUES speech in Las Vegas, Craig warned that the banking lobby is working hard at a divide and conquer strategy of splitting big CUs from smaller ones and that strategy must not prevail requiring the industry become united. Even though the Utah Bankers Association lost its bid in 2003 to impose a tax on CUs, “they won’t rest” in his home state as well as elsewhere, he concluded. -
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