American Banker reports on growing credit union concerns

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.