Newsroom
NAFCU urges lawmakers to see through bankers’ false narrative on mergers; calls for Modern Glass-Steagall to protect consumers
NAFCU President and CEO Dan Berger Tuesday broke down facts for lawmakers ahead of today's House Financial Services Subcommittee on Consumer Protection and Financial Institutions hearing to examine financial services industry consolidation, competition, and technology in response to the American Banker Association's (ABA) testimony misrepresenting voluntary bank-credit union mergers.
"It is ironic that ABA is claiming the credit union tax exemption is a ‘new factor’ in banks looking to merge with credit unions," said Berger. "Mergers between banks have been occurring at a significantly higher rate with 5,000 mergers between banks occurring since 2003. Just yesterday, the Wall Street Journal examined bank merger data and found that bank to bank mergers were on track to hit the highest level since the financial crisis. ABA should tell policymakers the truth on why their industry is consolidating.
"During the hearing, we call on policymakers to look past the rhetoric by the banks and instead focus on how the banking industry can be safer for consumers. In their efforts to make profits, banks have ignored consumer protection laws resulting in $243 billion in fines since the financial crisis," concluded Berger. "Policymakers should consider creating a modernized Glass-Steagall Act in order to protect consumers and taxpayers from banks that are ‘too big to fail.’”
In addition, NAFCU's Brad Thaler wrote to the subcommittee Tuesday to further outline where bank lobbyists inaccurately represent these voluntary mergers.
In the letter, Thaler, NAFCU vice president of legislative affairs, noted that, contrary to what the banking trade association's say, bank and credit union mergers are typically a win-win for a local community that may lose its community-focused financial services, or even local employees and branches, if a mega-bank buys the local community bank.
"Credit union-community bank mergers often mean employees retain jobs and branches remain open with a focus on the members in the community," wrote Thaler. “These mergers also cannot occur without approval from both bank and credit union regulators."
Thaler explained that while banking industry trades have used the topic of mergers to attack the tax status of credit unions, they fail to explain that "these mergers are often purchase and assumption transactions and are subject to taxation at the bank level." Moreover, the credit union involved with the merger pays many of the taxes, such as local property taxes and payroll taxes, when the former bank remains open as a credit union.
"They also fail to point out that nearly one-third of all banks are Subchapter S corporations and do not pay corporate income taxes themselves," wrote Thaler. "These annual tax breaks for banks far outpace the annual tax expenditure of the credit union tax exemption."
In addition to responding to the bankers, Thaler outlined several of NAFCU's priorities under review by the subcommittee, including regarding regulation of fintechs, opposition to NCUA gaining third party vendor authority, the need for relief for de novo credit unions, support for all credit unions being able to add underserved areas, and support for the Credit Union Governance Modernization Act, H.R. 2311, which would make it easier for credit unions to expel members who threaten the credit union. Read the full rebuttal here.
Share This
Related Resources
Add to Calendar 2024-05-16 14:00:00 2024-05-16 14:00:00 Spotting and Reporting Elder Financial Exploitation Elder financial abuse cases can often be difficult to investigate. Join us in learning more about the evolving red flags associated with this crime as well as the current regulatory landscape. In this webinar, Spotting and Reporting Elder Financial Exploitation, you’ll discover useful insights into performing an elder abuse investigation as well as reporting requirements. At the end, you and your team will feel confident in handling financial exploitation cases. Key Takeaways Identify changing red flags for financial exploitation Locate important resources for your investigations Draft eye-catching SARs Register Now $295 Members | $395 Nonmembers(Additional $50 for USB)One registration gives your entire team access to the live webinar and on-demand recording until May 16, 2025Go to the Online Training Center to access the webinar after purchase » Who Should Attend NCBSOs NCCOs NCRMs BSA, compliance and risk titles Education Credits NCRMs will receive 1.0 CEUs for participating in this webinar NCCOs will receive 1.0 CEUs for participating in this webinar NCBSOs will receive 1.0 CEUs for participating in this webinar Web NAFCU digital@nafcu.org America/New_York public
Spotting and Reporting Elder Financial Exploitation
Credits: NCCO, NCBSO, NCRM
Webinar
Add to Calendar 2024-05-14 14:00:00 2024-05-14 14:00:00 Navigating Fair Lending Compliance: Laws, Best Practices, and Regulatory Guidance Join our impactful webinar, Navigating Fair Lending Compliance: Laws, Best Practices, and Regulatory Guidance. This session is designed to enhance your understanding of federal fair lending and related laws, focusing on their interplay and including key statutes such as the Equal Credit Opportunity Act, the Home Mortgage Disclosure Act, and the Fair Credit Reporting Act. You’ll also delve into practical guidance and best practices to ensure your institution adheres to regulatory expectations and offers products and services in a fair and non-discriminatory manner. Key Takeaways Understand and identify various forms of discrimination in lending practices Review and interpret guidance from regulators to improve compliance strategies Get up to speed with the latest updates, including the new Regulation B rule on small business lending Register Now $295 Members | $395 Nonmembers(Additional $50 for USB)One registration gives your entire team access to the live webinar and on-demand recording until May 14, 2025Go to the Online Training Center to access the webinar after purchase » Who Should Attend NCCOs NCRMs Compliance and risk titles Education Credits NCRMs will recieve 1.0 CEUs for participating in this webinar NCCOs will recieve 1.0 CEUs for participating in this webinar Web NAFCU digital@nafcu.org America/New_York public
Navigating Fair Lending Compliance: Laws, Best Practices, and Regulatory Guidance
Credits: NCCO, NCBSO, NCRM, NCVE
Webinar
Add to Calendar 2024-05-13 09:00:00 2024-05-13 09:00:00 Covering Your Assets- The Bottom Line on Tracking and Collateral Protection Listen On: Key Takeaways: [04:23] Having access to policy and claim information is vitally important so you can mitigate your risks in that area. [06:39] Members are shopping and changing their insurance more than ever before. 41% of households with car insurance shopped for coverage at least once in the last 12 months. [10:05] One of the leading indicators of a default or a repossession situation is the dropping of insurance. [12:49] The most important thing from a tracking and risk management perspective is to make sure that the borrower lists the credit union as a lienholder. Web NAFCU digital@nafcu.org America/New_York public
Covering Your Assets- The Bottom Line on Tracking and Collateral Protection
Strategy & Growth, Consumer Lending
preferred partner
Allied Solutions
Podcast
Add to Calendar 2024-05-07 14:00:00 2024-05-07 14:00:00 BSA Training for the Board of Directors This webinar, BSA Training for the Board of Directors provides vital training with a comprehensive overview of the Bank Secrecy Act (BSA), anti-money laundering (AML) and combatting the financing of terrorism (CFT) compliance requirements. You’ll explore the ramifications of non-compliance and gain insights into the expectations and requirements set forth by the National Credit Union Administration (NCUA). This includes discovering how board engagement plays a pivotal role in fostering a robust BSA/AML compliance program within your credit union. Don’t miss this opportunity to equip your board with the knowledge and insights needed to navigate the regulatory landscape effectively. Key Takeaways Identify BSA/AML compliance requirements Review board member duties as it relates to BSA/AML compliance Examine current regulatory actions that may impact your credit union Register Now $295 Members | $395 Nonmembers(Additional $50 for USB)One registration gives your entire team access to the live webinar and on-demand recording until May 2, 2025Go to the Online Training Center to access the webinar after purchase » Who Should Attend Board members Board chairs and vice chairs Supervisory committee members Presidents/CEOs Executive assistants Education Credits NCRMs will recieve 1.0 CEUs for participating in this webinar NCCOs will recieve 1.0 CEUs for participating in this webinar NCBSOs will recieve 1.0 CEUs for participating in this webinar NCVEs will recieve 1.0 CEUs for participating in this webinar Web NAFCU digital@nafcu.org America/New_York public
BSA Training for the Board of Directors
Credits: NCCO, NCBSO, NCRM, NCVE
Webinar
Get daily updates.
Subscribe to NAFCU today.