By John Fenton
In yesterday's Skybox post, six credit union CEOs called for the merger of CUNA and NAFCU into a new entity that would, according to the post, better serve the needs of our industry. I respect those seeking to improve the credit union system and encourage more cooperation among our associations, but I do not feel that this is the time to be talking about a merger.
Here we are in the midst of a major financial crisis, one that many have said approaches the Great Depression in its magnitude and severity, and once again trade politics has raised its ugly head. Now is not the time to argue over what is the best structure for a new trade association; now is the time for our existing associations to work together to ensure that credit unions have the regulatory tools they need to survive and continue to serve their members’ needs in this time of economic uncertainty.
Rather than focus on whether one association is willing to talk merger or not, let’s focus on the problems that need to be addressed, whether those are safeguarding our deposit insurance system, easing liquidity needs or working together on Capitol Hill to make sure credit unions are included in any new sweeping financial services legislation.
I personally don’t have a stake in either organization. I do not serve on the NAFCU or CUNA Boards, although my credit union has been a member of NAFCU since 1983. I have defended NAFCU previously because I believe very strongly there should be an independent voice for federal credit unions.
At NAFCU’s inception in 1967, some did not see the value of an independent trade association for federal credit unions. Yet there have been many accomplishments that clearly prove NAFCU’s worth. These include the enactment of bankruptcy reform legislation that protects the right to reaffirm a member’s debt, NAFCU’s leadership in the California credit card case, and its active interaction with the NCUA to achieve needed FOM and chartering changes.
At times, there are issues that galvanize our entire industry, like H.R. 1151, when the strength of both NAFCU and CUNA has been leveraged to secure passage of vital legislation. Today, there is the Credit Union Regulatory Improvements Act, which likewise is benefiting from the support of both groups. Multiple voices don’t necessarily mean competing messages; in fact, several strong voices are often needed to cut through the cacophony that is Washington. Open and consistent communication among the trade groups is much more important in these instances than having a single association.
This isn’t the time for dividing our industry with merger talks. Rather, it’s a time for coordinated action on the part of all credit unions—and our two major trade associations—for the benefit of everyone in our industry. I understand that NAFCU has suggested that its leaders and CUNA’s meet more regularly under the auspices of the National Legislative and Regulatory Coordinating Council. To me, that is a logical and positive first step toward greater cooperation.
John Fenton is president and CEO of $1.475 billion Affinity Federal Credit Union, Basking Ridge, N.J.
Read other posts about the financial crisis and its impact on credit unions.
