22 Hoosier Banker April 2016 So here we go again. It’s yet another disturbing proposal from the National Credit Union Administration to bureaucratically finagle its way around Congress and federal law. Even as nearly one-third of Americans are already members of a credit union, it seems there’s almost nothing the NCUA won’t try to further expand the market reach and special tax-exempt privileges of the credit unions it supervises. Talk about your captive regulator! When credit unions say “jump,” the NCUA asks, “how high?” Recently the NCUA’s sweeping, 167-page proposal to hand federal credit unions virtually unlimited freedom to serve almost any person of any means anywhere rightly drew an avalanche of letters from infuriated community bankers. If adopted by the NCUA’s unelected three-member board, the proposal would impose comprehensive and substantive regulatory changes that would allow federal credit unions to cobble together ever larger, more disparate and more imaginative fields of membership. While the Federal Credit Union Act clearly limits membership in community credit unions to serving individuals and organizations within a well-defined local community, for example, the proposal would recognize some entire congressional districts as local communities. Even more absurd, one provision would allow community credit unions in seven states ‒ Montana, Alaska, Delaware, North Dakota, South Dakota, Vermont and Wyoming ‒ to serve their entire state. Basically all air-breathing mammals in the United States would qualify to be credit union members. The multiple provisions of the NCUA’s proposal would, in combination, essentially render any field of membership requirements a meaningless policy fig leaf, particularly for multi-common bond credit unions and community credit unions. As the Independent Community Bankers of America wrote to the NCUA, this proposal makes a mockery of both the plain language and the clear intent of the Federal Credit Union Act. If credit unions or their regulator want to eliminate the common bond requirement, those credit unions should be taxed like banks and should be required to shoulder the same set of regulatory standards. Or, more simply, they should adopt a bank or thrift charter. Certainly the NCUA’s obsessiveness in pushing against About the Author Camden R. Fine is president and chief executive officer of the Independent Community Bankers of America. He came to the ICBA from Midwest Independent Bank, Jefferson City, Missouri, where he chartered and organized the bankers’ bank and served as president and CEO for nearly 20 years. A long-time member of the ICBA prior to becoming the association’s president and CEO, Fine served on several association standing committees and on the ICBA board of directors. The author can be reached at: cam.fine@icba.org. FEATURE From Farce to Menace
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