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Fla. league letter to IMiami HeraldI stresses CU soundness
MIAMI (5/5/09)--In a letter to The Miami Herald, Florida Credit Union League President/CEO Guy M. Hood stresses that credit unions overall are sound. The letter responds to bankers' attacks after the conservatorship of Eastern Financial Florida CU, a $1.7 billion asset credit union in Miramar, Fla., was announced. The credit union's situation is "an anomaly in the credit union movement and not reflective of credit unions as a whole," Hood writes. He reiterates that the credit union continues to be financially sound and each member's deposits are federally insured up to $250,000. "Credit unions are extremely responsible lenders. The Florida Bankers Association's agenda toward credit unions clearly nullifies any opinion they might offer concerning credit unions," he says. Although loan delinquency rates and charge-off rates at credit unions are edging up in the bad economy, as might be expected, "they are still low compared with those of commercial banks…" Hood adds. Credit unions continue providing better rates because they are member-owned and not-for-profit cooperatives, and although others are unable to lend, the credit union industry's lending is expected to increase in all categories, he says. He also mentions' credit unions' healthy capital-to-asset ratio of 10.9%, and the fact that credit unions are more highly regulated than any other financial institution. "What happened at Eastern Financial is not costing taxpayers one penny in terms of bailout or subsidy. Can that be said about banks caught in similar situations?" he concludes. For the full published letter, use the link.
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