America’s Credit Unions President/CEO Jim Nussle detailed the credit union perspective on the topic of mergers in conjunction with Wednesday’s House Financial Services Subcommittee hearing to discuss merger policies of the federal banking agencies.
“We have unfortunately seen the negative effects of mergers that reduce choice, reduce competition, and impair the consumer experience,” wrote Nussle. “There are some who look to deflect from those concerns by calling eyes to banks selling to credit unions, yet conveniently ignore the benefits of these transactions. These bank-credit union mergers make up a tiny fraction of total bank merger activity.”
He explained that bank-credit union mergers often involve low-income areas, which “ensures that the consumers most affected by banking deserts retain access to a local financial institution.” In addition, he noted that the sales are not forced and are taxed.
Nussle also called attention to the need for support of legislation that reduces burdens on smaller lenders.
“As this hearing discusses the negative impacts of bank mergers to consumer choice and access to financial products, it is important to include in the conversation the impact of burdensome regulations that impose significant costs on smaller lenders that lead to the need to merge in the first place,” he concluded.
Read the full letter. America’s Credit Unions will continue to engage lawmakers on this topic.
