WASHINGTON – NAFCU said it has rebuffed CUNA’s latest merger overture, saying it has no interest in combining the two credit union trade groups.
NAFCU President Fred Becker said his board unanimously voted against the CUNA offer in June and remains opposed, as CUNA has made its proposal public in recent days.
CUNA said its overture was the result of a white paper signed by six independent credit union executives that support the creation of a single national trade association representing credit unions. The paper, titled "A Stronger and More Effective Single Trade Association for Credit Unions. The Time is NOW," was signed by six leading credit unions CEOs: Mary Cunningham, of USA FCU; John Bommarito, of Western FCU; Teresa Freeborn, of Xceed FCU; Kirk Kordeleski, of Bethpage FCU; Nader Moghaddam, of Financial Partners CU and Gordon Dames, of Mountain America FCU.
But NAFCU President Fred Becker noted several previous CUNA overtures and said he believes the merger proposal was initiated by CUNA.
"Absolutely not," Tom Dorety, chairman of the CUNA Board, told The Credit Union Journal yesterday.
Dorety, the president of Suncoast Schools FCU, said the CUNA Board supports a merger because of the pressures of a number of trends, including the recent merger of the two main banking groups that rival credit unions, the American Bankers Association and America’s Community Bankers; the inability of credit unions to get meaningful charter reform despite the work of the separate lobbying groups; and the increasing financial pressures on credit unions, both from the ongoing economic crisis and the double dues paid by many large credit unions.
NAFCU’s Becker said his group continues to see the value of different approaches taken by the two main lobby groups and also has concerns how a new association to be formed by the two would be influenced by CUNA’s state league affiliates.
Becker said NAFCU, a direct membership organization, has doubts that any new organization would adopt a similar structure, as credit unions must join CUNA and offer input to CUNA through its state leagues, which hold a third of the seats on CUNA’s board.
He noted that the CUNA offer comes as both Navy FCU and Pentagon FCU, the nation’s largest and fourth largest credit unions and staunch NAFCU members, have disaffiliated from CUNA, and at least one other top ten credit union has threatened to do so. "It’s got to be embarrassing to CUNA after they lost Navy and Pentagon," said Becker.
"CUNA and the leagues are under pressure. We’re doing fine this year. In fact, we’re having one of the best years since I’ve been here," said Becker.
The white paper said, "Both (NAFCU) and (CUNA) care deeply about the principles of the credit union movement. However, the current system of supporting two trade associations no longer works in our movement’s best interests."
The two trade associations, said the paper, regularly "compete against each other for dollars, for congressional action, and for the regulator’s ear."
"The existence of two trade associations is harming the movement," asserts the authors.
