By Frank J. Diekmann
Credit unions often like to talk about–and rightfully so--the “impact” they have on their communities. Helping someone dig out from under card debt. Getting a parent into a used car so they can get to work and feed their family. Handing over the keys to an overjoyed first-time homeowner. But how about this “impact?”
Impact is defined as the action of one object coming forcibly into contact with another, so perhaps the word doesn’t fit in this example, since it’s all about avoiding any contact. In this case, it’s the work one credit does that very few people—OK, almost no one, especially in the U.S. and other developed nations--would ever think of.
There are seldom ever better examples of true community “impact” being done than in the work done and experiences had by people associated with the World Council of Credit Unions, including this tale.
During the recent “Underground Collision: We are the World” virtual event hosted by Mitchell Stankovic Associates, Brian Branch, the retiring president of the World Council of Credit Unions, shared a story about doing work with a group of people involved in credit unions in Uganda.
Branch related how at the end of a day he and other WOCCU reps were seeking to return to where they were staying, as it was dangerous at night in the area. That’s when he witnessed groups of kids showing up at the local credit union. Branch said he asked if the CU was hosting some sort of event for them. No, he was told, the kids were being brought by their parents because the credit union had a wall around it and a security guard, and the area was known for the kidnapping of children. Leaving the kids at the credit union would allow them to remain safe and to go to school the next day.
“Here is where a credit union was not just a beacon of financial security, but personal security,” said Branch.
Sometimes, people helping people isn’t enough. It’s good to reminded that in many places in the world it’s even more about people protecting people.
A Refresher Course
Speaking of Branch, the World Council of Credit Unions recently concluded its week-long virtual World Credit Union Conference. CUToday.info had considerable coverage, which you can find by searching “World CU Conference Coverage” on our website.
The 50th annual meeting of the World Council concluded with a video featuring Branch in which he talks about the value credit unions provide people of all income groups. If you’re unfamiliar with WOCCU, or just want a refresher course on what credit unions mean to people around the world, you can watch the video here.
Perhaps It’s Good They’re Not Near Us
The following was observed during the World CU Conference by marketing guru Bonin Bough during a session on how the world has changed but many organizations are trailing behind: “Right now, less than 10% of our (marketing) time is spent where people are spending 90% of their time.”
How much time? According to Bough, statistics show more people text than use toothpaste or deodorant. So, perhaps it’s best they text.
What About This Exit Fee?
As CUToday.info extensively reported, the Independent Community Bankers of America (ICBA) recently called for an “exit fee” to be paid any time a credit union buys a bank. The ICBA said such a fee would offset the lost tax revenue, as the banking industry is always very concerned about taxes being paid when it comes to any group other than themselves.
In a letter to the Treasury Department, the ICBA said it wants an examination conducted of what it called “abuses of the tax code causing increased acquisitions of community banks by tax-exempt credit unions.”
To save Treasury and Congress the trouble, as we all know they are quite busy, the bankers not only proposed the “exit fee” tax on credit unions acquiring community banks to “capture the value of the tax revenue that is lost once the business activity of the acquired bank becomes tax-exempt,” they also got down to specifics, proposing that the fee should be equal to 10% of the gross value of the acquired bank’s assets or liabilities as shown on its most recent balance sheet, whichever is greater.
As expected, I can only imagine Capitol Hill was stunned when credit unions responded, with NAFCU providing a rather detailed response.
But perhaps credit unions would have been better off by proposing an “exit fee” of their own, in this case on banks every time they exit a market with a branch. Any market. And for any reason. Or, what about applying a fee when exiting a product many customers use, such as Wells Fargo’s recent move to abandon the personal loans many people use for overdraft protection?
And, demonstrating they also know how to help Congress and Treasury save some time, maybe the CU trade groups could even provide guidance on the fees to be paid.
Good Luck Complying With This
Whether in-person or conducted virtually, NCUA’s broadcast of its monthly board meetings includes accompanying text generated by speech-recognition software. Given the number of different voices, tones, inflections, accents and more in the spoken word, the fact the software is as accurate as it is is something of a tech miracle.
But that isn’t to say there aren’t some miscues. The most recent NCUA board meeting included this voice-to-text translation: “Everything that chronic cough call liquor record.”
Good luck to the compliance folks.
Frank J. Diekmann is Cooperator in Chief of CUToday.info and can be reached at Frank@CUToday.info. Mr. Diekmann is also author of a brand new book, “The Last Lyric,” a humorous satire about a murder investigation at the Rock & Roll Hall of Fame in which every line of dialogue is either a classic pop/rock song title or lyric. Available on Amazon, Apple iBook, Barnes & Noble and Smashwords.