Hoosier Banker 7 While community banks have been busy the last few months processing Paycheck Protection Program loan applications to help their customers and communities, Crane Credit Union has been busy negotiating a deal to buy an Indiana bank. CCU is not listed on the Small Business Administration website as a PPP lender. Apparently its priority was growing larger and converting taxpaying assets to non-taxpaying assets, instead of helping small business through the COVID-19 crisis. Or perhaps the 1% interest rate on PPP loans was not enough profit for the tax-exempt credit union. Is that really the type of institution that should be buying banks? Throughout the PPP process, the country witnessed banks serving their customers and communities better than any other type of lender. The banking community stepped up and helped small business customers when they needed it most. Credit unions claim to be more customer-oriented than banks, but they are not subject to the Community Reinvestment Act requirements that banks are. The poor turnout of credit union assistance with PPP loan applications is further proof that they do not support communities like banks do. According to the SBA, through June 27 banks under $1 billion originated $84,644,341,288 of PPP loans, while credit unions under $1 billion originated $2,986,484,375 of PPP loans. That’s an astounding difference. The credit union industry says it’s consumer-focused, not businessfocused. Then why are credit unions desperately trying to expand their business lending authority and buying commercial banks? If credit unions are not banks, and don’t want to be banks, then they should not be buying banks. When banks are in a position to sell, the credit union tax exemption allows them to offer the highest price, and bank directors feel obligated to accept the highest price for their shareholders. Unfortunately, these sales hurt communities. In the sale of a taxpaying bank to a non-taxpaying credit union, the community loses valuable tax dollars used to support essential services and local projects. Then, to avoid lower tax revenues in the future, taxes are raised on the remaining taxpayers. Communities also lose when a bank is sold to a credit union by missing out on the additional support and service that banks provide. This is the third bank in Indiana to sell to a credit union within the last year. Six Indiana banks have been sold in the last year, meaning that half have been sold to credit unions. How many more of these transactions will there be before laws are changed? We need laws that prohibit credit union acquisitions of banks or laws that level the playing field between banks and credit unions when it comes to buying a bank. Furthermore, credit unions can buy mutual banks, and banks cannot. How is it possible that our laws allow credit unions to buy more types of financial institutions than banks can buy? Tax-exempt credit unions continue to accelerate their purchase of taxpaying banks, expand their business lending authority, weaken their membership rules, and act like banks. It is time to stop credit union creep. If a credit union wants to buy a bank, let it become a bank, be taxed like a bank, and follow the same regulations as a bank. We need to stop the credit union poaching of our brethren. The Indiana Bankers Association, Independent Community Bankers of America and American Bankers Association all have grassroots portals on their websites. I would ask every member of the IBA to use those tools and reach out to legislators and regulators to speak up for change. As the government spends trillions of dollars in stimulus in response to COVID-19, we need more taxpaying banks, not bigger tax-exempt credit unions. HB CHAIRMAN’S REPORT Garrett State Bank • @GarrettStBank • May 12 We are honored to team up with Hometown Graphics - Print & Design to sponsor the yard signs they have made for each Garrett High School senior! Thank you, Cassie, for all your hard work. We as a community bank are so thankful to be able to recognize the seniors. STAR Financial Bank • @STARFinancial • May 1 Earlier this week Kingston Healthcare gifted lunch to the employees at our Fort Wayne service center. This morning we were so excited to gift 375 Degree Donuts and fruit to the Waynedale Majestic Care Facility. A special “THANK YOU” to essential workers and our local businesses. Crossroads Bank • @CrossroadsBank • April 29 Crossroads Bank has donated $50,000 in total to Wabash, Whitley, Kosciusko and Miami counties. These foundations are responding to the urgent community needs during the #COVID19 pandemic. We appreciate their work to get these funds dispersed. #BanksHelpingHoosiers #INthistogether Centier Bank • @CentierBank • April 23 Our hospital workers are our heroes! To show our gratitude and support, we sent Methodist Hospitals Northlake in Gary meals from Pappas Restaurant. Find out how you can support our frontline workers at Methodist Northlake: https://mealtrain.com/ trains/7ywdd1 Follow IBA Twitter @indianabankers NOTABLE QUOTES Bank Community Service on Twitter Lucas White Chairman Indiana Bankers Association President The Fountain Trust Company, Covington @LucasNWhite
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