A new article features growing concerns that the nation’s largest credit unions are increasingly behaving more like profit-driven banks with a tax advantage than mission-centric nonprofits.
Details: The article in American Banker (subscription required):
Cites National Credit Union Administration board member Todd Harper’s concerns that the number of troubled complex credit unions tripled in the last quarter of 2024.
Quotes ICBA Senior Vice President and Regulatory Counsel Michael Emancipator on the need for closer regulatory scrutiny of larger credit unions.
Cites concerns from Aaron Klein of the Brookings Institution that some credit unions are increasingly acting like for-profit banks while taking advantage of the regulatory and legal benefits associated with their nonprofit status.
ICBA Advocacy and Growing Scrutiny:
ICBA has repeatedly called for policymakers to end the tax exemption for credit unions over $1 billion in assets as these institutions continue to use their tax-exempt status to acquire tax-paying community banks.
A May Bloomberg article captured lawmaker concerns about the full federal tax exemption for credit unions.
Recent ICBA polling conducted by Morning Consult shows 62% of U.S. adults say credit unions that operate like banks should have to pay taxes like banks.