Kudos and Brickbats With Observations Thrown In

Every so often there comes a time for extending kudos or for tossing a few brickbats. Or simply making some observations on something credit union people have done, or not done. This is that time. Brickbat: The mainstream news media in Madison, Wisconsin, which has had a strong credit union presence forever, still can’t seem to get it straight. Not only do news reporters not know the substantial difference between a CUNA and a CUNA Mutual Group, they keep proving they don’t know the difference between a credit union and a bank. In a recent news item describing the UW Credit Union as a phishing target, they referred to credit union members throughout the piece as customers. Credit union PR types in Madison and elsewhere across the country need to hammer the media every time they make this serious error. Banks don’t have members. Credit unions don’t have customers. It’s that simple. Kudos: The North Carolina Credit Union League recently commissioned a study entitled, “The Benefits of Credit Unions to North Carolina Consumers of Financial Services.” The state’s banking association went berserk when they saw the study’s results reported in the newspaper. According to the study, credit unions saved the state’s consumers (CU members) a ton of money by offering members lower rates and fees, but also by keeping the banks honest. Supporting stats were impressive. The local banking group fired off a letter to the editor challenging the validity of the study and its pro-credit union findings. Kudos because the league got it right. Let the banking industry react to something positive credit unions are saying rather than vice versa which is usually the case. How refreshing to see the bankers playing defense for a change. Brickbat and Kudos: The upcoming NASCUS annual conference has scheduled a session entitled, “Credit Union to Bank Charter Conversion Colloquium” which, according to NASCUS “will bring together concerned leaders in the credit union movement for a frank assessment of some credit unions’ conversion to a bank charter.” Kudos because the group is including such a timely, controversial, and newsworthy topic on its conference program. The brickbat is also given because the panel features the wrong people and the wrong moderators. Looks like a yawner. About the only panelist who has credibility on the panel is Texas League CEO (and current CUNA Chairman) Dick Ensweiler who is in the thick of the attempt by two of his largest credit union members to bid his league and CU land adieu. Where are the outspoken foes and advocates like Jim Blaine (foe) and Lee Bettis (advocate) to name just two? Much stronger panelists who could produce a more meaningful discussion could and should have been drawn from the firing line. Like a credit union CEO who has converted, or is in the midst of a conversion (pro), or a representative from one of the groups out there fighting CU to bank conversions (con). Observation: Some old timers in credit union circles fret long and loud that too many credit unions are hiring an ex-banker as their CEO. Maybe instead they ought to note the recent influx of regulators into the CU corner office. As CU CEO, former NCUA Regional Director John Ruffin is growing Robins FCU in Georgia by leaps and bounds (over $900 million by year’s end) since he became one of the regulated replacing veteran CEO and CUNA leader Buck Levins who was unceremoniously put out to pasture. Meanwhile, the top state regulator in Washington, J. Parker Cann, after a brief stop as a staffer at California’s Arrowhead CU, is now CEO at much-in-the news Columbia CU replacing David Doss who bolted for a CU CEO opportunity in Arizona. Columbia’s the credit union that failed in an attempt to become a bank. Is the transformation of regulators to credit union CEOs a new trend? Kudos to the Oklahoma Credit Union League for supporting a bill that makes it illegal to slander credit unions (and banks). According to the new law, it is unlawful for any person to publish, utter, or circulate any false or malicious information about credit unions (or banks) with the intent of doing them any harm. Wow. This law needs to be enacted nationwide. Should be something the banking industry would support in case credit unions ever decide to say nasty and inaccurate things about them to return the favor, but don’t count on it. Brickbat: NCUA Board Member Debbie Matz seems to have inadvertently put her foot into it again. This time in a speech to the Community Development group. Obviously intending to make them feel good, she said that she is confident that Community Development Credit Unions represent not only the past, but the future of credit unions. Pretty tall order for those little, often struggling folks. To be fair, I assume she was referring to the mission of CDCUs and was making the point that if all credit unions follow the lead of CDCUs, credit unions will have a bright future. Unfortunately, even many CDCUs quietly disappear after a short existence. If they can’t make it concentrating on serving the so-called underserved, how can a larger credit union with say a community charter, make a go of it by doing so? It can’t. As someone smarter than me once said, poverty is not a common bond. The future of credit unions depends on serving all members, not just a segment defined as underserved. Final Observation: As the ranks of the billionaires club (those CUs at least one billion in assets) continues to grow rapidly (currently 104 in number), it appears that the 80/20 theory (20% of CUs have 80% of members and assets) has gone by the boards. That theory is now more accurately known as the 90/10 theory. Possibly before long it will become the 95/05 theory. The $64,000 dollar question: Is this a good thing for credit union members? Comments? Call 1-800-345-9936, Ext. 15, or Fax 561-683-8514, or E-mail [email protected].