The following is an excerpt from an e-mail a small credit union CEO sent me about current challenges his credit union faces:

“Hiring and retaining bilingual employees, paying extra for printing of bilingual marketing material, competing with rates geared to attract larger balance accounts yet working with more modest balance accounts, meeting OFAC requirements that could be a full-time position in this area and keeping up with other regulations that seem to be coming faster than a speeding bullet.”

This speaks volumes, need we say more? Maybe. If you throw in tight margins, rising rates, no love on the yield curve, and elevated health care costs, you're talking about a tough environment for credit unions. Not to mention, with many CUs now serving larger fields of membership, branding is becoming more important and branding costs money. Therefore, the cost to acquire a member's business is also going up.

Clearly, complying with new and more burdensome regulations is something all credit unions are struggling with. Sure, the larger credit unions have more resources to handle this, but it is still costing them much more than yesteryear. It is not uncommon for larger CUs to have BSA compliance managers on staff. You didn't see that five years ago. For smaller CUs, these new regulations can push them to the brink of merger. A bad thing? Depends on who you ask. Certainly Mr. Denmark (see letter on page 17) thinks so.

If you talk to credit union veterans and pioneers like Jim Williams (featured on page 1) you'll hear them say that today's larger credit unions aren't doing enough to mentor smaller ones. Back in the day, mentoring and helping your smaller brethren was part of a larger CU's existence, but not any more.

So what is the responsibility of larger credit unions? Should they be pulling out all the stops to help smaller credit unions survive? Or should they let market conditions play out and whatever happens, happens? Should trade associations, corporate credit unions, CUSOs, and even vendors be doing more to help smaller credit unions continue existing?

Let's face it, if the credit union industry wanted to help smaller credit unions, it could easily, yes I say EASILY, raise the money. Look at the millions of dollars raised for political action committees. Drilling down, consider the enormous amount of money individual credit unions raise for charitable causes. Vendors too raise millions of dollars for good causes. The credit union industry deserves a standing ovation for its philanthropic efforts. I see hundreds of press releases each month that document CUs raising anywhere from a few hundred dollars to hundreds of thousands for charity. The $270,000 that DCU was able to raise for the Boomer Esiason Foundation (page 19) is a shining example, and is one of many. I am continually amazed and elated by the good work credit unions do–it demonstrates the credit union spirit.

Should the new charitable cause for the credit union industry be other credit unions? Imagine, raising money to help each other. It would certainly be harder to convince members to donate money to help a small CU in Iowa, rather than to say the Children's Miracle Network, another example of how the industry has been able to raise millions of dollars for a cause.

But maybe it's not so crazy. If you look at credit unions' track record of philanthropic efforts, then the more credit unions we have, in the long run, the more charitable work they can do for others, and hopefully the more they can do for their members with better products and services.

Giving money to a small credit union though isn't the answer. The money would have to be put to work in a productive manner, such as creating some sort of compliance help center in each state that could greatly reduce the regulatory burdens of small credit unions. The same can be done for technology services, for mortgage products, etc. Crazy? Or worth it? I bet opinions vary wildly on this.

Me, I'm not sure it makes sense to help small credit unions just because they're small. I do think it's worth it to help small credit unions that want to grow. It makes sense to help small credit unions that are trying to do more for members, but are being crushed by rising compliance costs, etc. However, we all know there are a lot of small credit unions that are quite happy with the status quo and aren't looking for more. If the small credit union has to be gobbled up because their CEO, who did everything from compliance to investments to member service, retires, then so be it. But the small credit union that wants to grow–yes growth must be a goal–they should be able to turn to somewhere in the industry for help. If that help is not there, they've been let down.

There is so much talk these days about the disappearance of small credit unions and how no one is doing enough to ensure their survival that this should become a national discussion that could lead to action or inaction. Pet projects in various states to help small CUs isn't enough, it's a national issue. Groups like the National Credit Union Foundation or the National Federation of Community Development Credit Unions can't do it alone. Leaders from CUNA, NAFCU, CUNA Mutual, the leagues, the corporates, CUSOs and the vendors that exist off of credit unions should get around a table and ask the tough questions. Should more be done to help small credit unions survive? Is it good for members? Is it good politically? Does it do more harm than good long term? Should market conditions win out?

These are bigger questions than I can tackle, but I do know they haven't been asked enough on a national scale by the leaders who can take action.

By the way, the excerpt at the top of this column was from Terry Denmark himself. Mr. Denmark's CU is a great example of a small CU striving for more. It recently took a calculated risk and opened a new branch to serve an underserved segment! This is a small CU that should have help if it needs it. Terry, I still don't agree with you that small CUs, because they're small, should be saved, but small CUs like yours that are continually working to do more for members, need to survive. It's good for everyone.