• 2003-2004 TBA Chairman Mike Schnell appointed a Credit Union Task Force consisting of 20 members and chaired by Mike Rigby.
• ABA and TBA are asking for your help in opposing HR 3579. Use Capwiz to send letters to your elected officials if you haven't already done so.
• At every opportunity, tell your U.S. Congressman and Senators and your State Representatives and Senators that you are adamant about bring parity in taxation to those credit unions that act like banks.

CREDIT UNION ACTIVITY IN TEXAS

• Twenty-nine percent of Texas credit unions offer small business services; of these, 82 percent offer business checking and 32 percent make business loans.
• Approximately 41 percent of Texas credit unions have community bonds, but are not subject to the Community Reinvestment Act.
• If taxed, Texas credit unions would have paid almost $121 million in federal income taxes in 2002.
• In Texas, credit union deposits have experienced an 8 percent annualized growth rate, while bank deposits have grown 6 percent.

The Texas banking industry is operating at an unfair advantage against those tax-free credit unions that have few restrictions on who can join and what they can do. These credit unions have "morphed" from their original purpose. TBA set out to do something about it...

WHAT IS TBA DOING ABOUT UNFAIR CREDIT UNION COMPETITION?

Task Force

In 2003, the Texas Bankers Association created at 19-member Credit Union Task Force to educate fellow bankers about the threats posed by these "morphed" credit unions and to communicate the message to lawmakers that if credit unions act like banks they should be taxed and regulated like banks.

Click here for meeting summaries of the Credit Union Task Force.

TBA's task force will coordinate efforts with the American Bankers Association, but will focus on the Texas perspective.

Grassroots and Government Relations

In addition to bringing interested bankers together to address the unfair competition wrought by a new breed of aggressive credit unions, the Texas Bankers Association has also formulated a grassroots and government relations strategy to address this important banking issue.

• Focused on educating bankers about HR 3579, the Credit Union Regulatory Improvement Act of 2003, which, if passed, would fuel even more rapid growth for large credit unions. The bill would expand their commercial lending abilities and artificially inflate their capital cushion-and raise safety and soundness concerns while maintaining their tax-exempt status.
• Added a grassroots section to the Website, which allows bankers to contact their officials and voice their opposition to HR 3579.
• Created a Commitment Form enlisting the help of Texas bankers in leveling the playing field. Bankers are encouraged to return this form to both the TBA and ABA. In return, they will receive a grassroots kit with materials on engaging employees and shareholders, as well as a periodic newsletter with legislative, regulatory and legal news affecting credit union competition, as well as other information pertinent to the effort.
• Disseminated information about Credit Union activities through its Credit Union Task Force Bulletin:
  
  Issue #1: March 1, 2004
  Issue #2: May 13, 2004
• Devoted an issue of Texas Banking magazine to credit unions See Toppling the tax-free Taj Mahals

CREDIT UNIONS DENIED ALL TBA ACCESS

The TBA membership unanimously voted to prohibit credit unions from any and all TBA membership services. For instance, credit unions are not allowed to participate in TBA's Fraud-Net service or any educational programs that TBA presents. Furthermore, the TBA Board of Directors decided not to participate in any events or trade shows that showcase credit unions.

Resources and Links

Get involved in grassroots!

Visit our Legislative Action Center and tell Congress about the existing competitive inequities between banks and credit onions and to oppose H.R. 3579, a bill that would further credit union expansion.

Click here to download and sign the Credit Union Commitment Form to receive a grassroots kit.

Click here to download a copy of “The Morphing of Credit Unions.” The booklet explains how many credit unions have changed over time from small organizations providing loans to people of limited means into complex financial institutions.

Click here to view the credit union area of the American Bankers Association's website.

to subscribe to the weekly Credit Union Update from the American Bankers Association.

See what the credit unions are up to:

National Credit Union Administration

Texas Credit Union Department

Credit Union National Association

National Association of Federal Credit Unions

Texas Credit Union League