Bill Intro’d In Nebraska Legislature Would Require Public Notification Of FOM Expansion Requests

LINCOLN, Neb.–Nebraska’s bankers are backing a bill in the state legislature that would require notification anytime a state-chartered credit union is seeking to


expand its field of membership, which would give the bankers the opportunity to challenge the request at a public hearing.

The bill has been introduced at a time several Nebraska credit unions are seeking to move into parts of the state dominated by banks, according to the Herald Courier. At present, Nebraska’s state charters simply need to apply to the state regulator for FOM expansions, with no public notification required.

“Credit unions provide competition to for-profit banks, and where there's competition, consumers benefit," Brandon Luetkenhaus, chief advocacy officer for the Nebraska Credit Union League, told the Herald Courier. "This is an attempt by the bankers' association to build barriers to business. They're trying to insert themselves into the regulatory process."

Tax Exemption Cited

The Nebraska Bankers Association, however, said credit unions have an unfair advantage with the federal tax exemption. Credit unions in Nebraska do pay state and local taxes.

"Our banks don't back away from competition," Richard Baier, president of the Nebraska Bankers Association, told the publication. "We compete with each other all the time. We just don't like having to compete with someone who gets subsidies we don't."

Among the state charters that is seeking to expand is the $98-million MemberOwn Credit Union, which is currently open to residents of Lancaster and Gage counties in Nebraska and which is seeking to expand into 11 additional counties.

"The department would basically have to send a certified letter to our competitors," Linda Carter, president of MembersOwn Credit Union, told the Herald Courier. "I can't quite understand why we want to add that extra layer of government."

How Banks, CUs, Compare

The Herald Courier reported Nebraska’s banks hold approximately 95% marketshare in the state, and reported more than $1 billion in combined net income in 2018, according to FDIC data.

There are 155 state-chartered credit unions in Nebraska and 12 state-chartered CUs, plus 17 federally chartered banks and another 48 federally chartered credit unions.

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Copyright Year: 2019
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