PEWAUKEE, Wis. (8/15/12)--Wisconsin credit unions' strong financial results at mid-year represents consumer savings, not "subsidy," said the Wisconsin Credit Union League, responding to misinformation from banks after the state regulator released its assessment of state-chartered credit unions' financial results.
"The broken record repeats," said league President/CEO Brett A. Thompson. "Every chance it gets, the [Wisconsin Bankers Association] WBA repeats misinformation in hopes that repetition will change the law and the facts. But their comments are no more accurate today than they were the last time, or the time before that, or the time before that," he said.
WBA has mischaracterized credit unions' net income as a tax "subsidy" and said credit unions' mission is to serve only those of modest means. The intentional mischaracterization is no accident, said the league.
The league reiterated two points:
- Credit unions return earnings to depositors, not shareholders in the form of lower loan rates, higher savings rates and fewer fees. In 2011, they saved 2.2 million members $203 million and they save Wisconsin bank customers $66 million each year because of the competition that helps to keep bank fees and rates in line.
- All credit unions exist to benefit depositors. "Under Wisconsin law, the mission of every credit union is to 'encourage thrift among its members, create a source of fair credit at a fair and reasonable cost, and provide an opportunity for its members to improve their economic and social conditions," said the league. Instead of limiting by income who credit unions can serve--as WBA suggests--state law requires credit unions to serve all members regardless of income, the league said. "Credit unions' growth is the result of all credit unions putting people before profits; it's a consequence of consumers using a locally owned, democratically controlled co-op to further their own financial interests instead of the narrow corporate interests of a few."
Thompson also criticized banks' role in the financial crisis and "relentless fee increases" that have "led consumers to pay closer attention to who realizes the perks of their patronage and where profits go.
"Consumers have realized that they themselves benefit when earnings from their financial institutions are returned to them rather than going into the wallets of just a few. That's why the increase in net revenues of credit unions so far this year is nothing but good news for Wisconsinites," he concluded.