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Since their lopsided loss in the House, the bankers have pumped up their anticredit union rhetoric just when you thought it couldn't get any louder. Reading the American Bankers Association's statement following House passage last month of the Credit Union Membership Access Act by a 411-8 vote, one could practically feel the spittle from the banks' sputtering: Credit unions are "an unrestricted entitlement program"... House members were "stampeded" by a "massive misinformation campaign"... Credit unions are nothing more than "highly profitable conglomerates."
Bankers did little to temper their verbal assault the day after the House vote when they testified before the Senate Banking Committee. Lawmakers have heard much of this verbiage before, and they take it with the appropriate grains of salt. Questioning by senators at that hearing did, however, raise two issues that will require careful explanation by credit unions so the bankers don't succeed in conducting-to borrow their own phrase-a "massive misinformation campaign."
The issues that surfaced are credit union business lending, and the difference between credit unions and mutual savings banks. To hear the banks tell it, credit unions are waist-deep in commercial loans, and their cooperative orientation is no different than that of tax-paying mutual savings banks. The facts, of course, tell a different story. During the Senate hearing, CUNA's witness Peggy Lents, chief executive officer (CEO) of Azalea City Credit Union in Mobile, Ala., set the record straight on both counts.
The savings and loan crisis clearly left its mark on Congress, even now. Senators are extremely sensitive...