news.cuna.org/articles/119300-donovan-cus-eager-to-bring-financial-services-to-communities
Ryan Donovan

Donovan: CUs eager to bring financial services to communities

April 7, 2021

It’s more important than ever that communities retain access to a local financial partner that can meet their needs, CUNA Chief Advocacy Officer Ryan Donovan wrote to all 535 Congressional offices Wednesday. He noted that credit unions are eager to be that partner, “which is why they’ve been there for some bankers when they’ve been ready to exit the market,” he wrote.

Donovan also added that, despite banker complaints over bank sales to credit unions, that increasing closures have to led to more financial deserts in urban and rural communities across America.

He also highlighted several things about bankers choosing to sell to a credit union over another bank:

  • 80% of bank-credit union transactions have involved low-income designated credit unions, ensuring that consumers most affected by banking deserts retain access to a local financial institution.
  • Bank-credit union transactions account for only 0.3% of all bank assets sold since 2012. Furthermore, credit unions only account for $1.9 trillion in all financial assets, while the four largest banks each hold more in assets. 
  • Since 2004, 86 banking deserts have been created by the net shuttering of nearly 6,000 bank branches. In the same period, credit unions have opened a net 1,600+ branches. Many community banks rushing to cash out their portfolios turn to credit unions to ensure their communities are served by a local financial services partner, reporting employee and branch retention among the top factors in the decision. 
  • Credit unions paid nearly $25 billion in local, state, and federal taxes last year. Meanwhile, bankers continue to celebrate a $30 billion annual tax break on investor profits. 
  • Credit unions returned $12.9 billion in earnings to members last year through their people-over-profit structure.