WASHINGTON–A recent survey of community bankers revealed credit unions aren’t considered meaningful competitors, so that should bring an end to bank trade association attacks on CUs, right? Probably not, America’s Credit Unions concedes.
As the CU Daily reported here, the Annual Survey of Community Banks was released by the Conference of State Bank Supervisors (CSBS) indicates credit unions are generally rated significantly below other providers as the biggest competitive threat.
Curt Long
But that isn’t expected to sway the traditional positions of the American Bankers Association or the Independent Community Bankers of America (ICBA), which annually extol Congress to revoke the credit union tax exemption.
Complaints Rise During Dues Season
“Their voices get loudest around dues season, and I think this is a line of argument that registers with their members,” said Curt Long, chief economist and vice president of data and research with America’s Credit Unions.
So, the attacks will continue, Long observed, even though there is not “a lot of evidence as far as credit unions acting in a threatening way to the fundamental existence of community banks.”
In reviewing the CSBS study, Long called many of the findings “interesting” and observed that when community bankers were asked to identify their primary competitors across a number of areas, CUs were “barely more than a blip on the radar.”
“I think it really speaks to the disconnect between the statements from the banking trade associations about the threat posed by credit unions and just the lack of evidence about that,” he added.
‘Speaks to the Difference’
Even in areas that are critical to many community banks, such as commercial real estate and agricultural lending, Long said the survey found credit unions were only rated by about 5% of respondents as significant competitors.
The only areas where credit unions were seen as somewhat stronger competitors were small-dollar, unsecured loans.
“I think that speaks to the difference of the type of business that credit unions are focused on versus community banks,” Long said. “It’s not a big line of business for the community banks, but it’s right in line with what credit unions do.”
