JEFFERSON CITY, Mo. – The banking industry attack on Wal-Mart Stores Inc. may have borne fruit this month in a tough new Missouri law on industrial loan banks but credit unions are in wait-and-see mode about any new olive branch in the field of membership battle.
"We indicated we would come to the table and talk," is how the Missouri Credit Union Association put it in responding to an appeal by the Missouri Bankers Association that bank and CU groups meet before the November elections to iron out a compromise package on FOM rules following a series of state court rulings.
The bankers' trade group said last week while CUs were noncommittal in enacting a precedent-setting Missouri law barring Wal-Mart and other retailers from opening industrial loan banks, it hopes "we can find common ground to avoid having the field of membership issue come before legislators."
Recommended For You
"Nobody wants a fight between banks and credit unions with lawmakers having to take sides," said William Ratliff, executive vice president of the MBA suggesting there are "reasonable grounds" for the groups to seek agreement.
But Peggy Nalls, senior vice president of public and legislative affairs, said that while MCUA was more than willing to discuss FOM issues, Missouri CUs remain highly skeptical about banker intent.
That's the case considering she was told by one banker recently that "he would like us to expand no more than 10 feet from the front door of the credit union's main office."
Regarding the Wal-Mart law, which takes effect Aug 28, the giant retailer would be barred from opening branches, taking loans or deposits in Missouri through industrial loan banks or industrial loan corporations.
The Missouri law, which had the backing of the MBA and a "neutral" stance of MCUA was adopted with little public comment and tracks a similar bill introduced last week in the U.S. House by Rep. Barney Frank (D-Mass.), a vocal opponent of ILC outreach.
The Missouri bill received no formal opposition from Wal-Mart, which has long maintained a public stance denying plans to open branch banks or enter into consumer lending. That intent was voiced before Congress and in FDIC hearings last April on a still pending Utah ILC application, which has drawn 4,000 protest letters.
"While work is done on a national law, I think you are seeing individual states like ours moving ahead in this area because there is a general distrust of what Wal-Mart says they will do," said Ratliff.
Ratliff acknowledged the MCUA did not join in supporting the Wal-Mart bill "but we want to meet on those other issues" referring to the FOM suits.
He said so far Missouri banks have managed "to win one suit" which in effect "allowed credit unions to expand within an entire area code and another for a zip code and so now we're back to square one." [email protected]
© 2025 ALM Global, LLC, All Rights Reserved. Request academic re-use from www.copyright.com. All other uses, submit a request to [email protected]. For more information visit Asset & Logo Licensing.
