When the Going Gets Tough
McQuillan, Bill, Independent Banker
As I pen my first letter to all of you, I would like to thank my good friend Bill Sones for his time and commitment to independent community banking. He has done a great job.
Last month you bestowed upon me the honor of serving as your president for the next year. While the banking industry's profitability continues to run at record levels, we face unusual political risk as the Congress considers sweeping financial restructuring legislation, which almost certainly would devalue the national bank charter, and as the credit union lobby seeks to over turn the pro-banking Supreme Court decision.
On Feb. 25, the Supreme Court agreed with the nation's bankers when it handed down a decision in our favor, supporting our position that the credit union industry has overstepped its bounds in its interpretation of "common bond." Because of our victories in the courts, we now face new battles on the Hill. The credit unions have mobilized all their forces behind HR 1151, a bill that would reverse the Supreme Court's decision. Unfortunately Speaker Newt Gingrich has co-sponsored this credit union wish list bill; a rare move for the highest ranking member of Congress. Consequently, we face an uphill battle convincing Congress that large, multi-occupational credit unions indeed are enjoying a free ride.
In turn, the Republican leadership of the Congress could tie this legislation to a sweeping financial modernization bill, which undermines the OCC and national bank powers. I have been chairing the credit union coordinating committee, which coordinates banking's response to the credit union threat. …