NYBA testified at a joint hearing of the State Assembly Banks and Local Governments Committees on Monday on the subject of authorizing credit unions to accept public deposits. NYBA President & CEO Mike Smith led a panel featuring John Buran, President & CEO of Flushing Financial Corporation, Tom Murphy, President & CEO of Arrow Financial Corporation, and Cheryl Bowers, President & CEO of Rondout Savings Bank. They made the case that taxpayer dollars should not be removed from taxpaying businesses, and that the anti-competitive move would result in less tax revenue for the State and less philanthropic activity and lending in the community. At the same time, NYBA argued that taxpaying thrifts should instead be granted the authority. Local officials testifying on behalf of counties also expressed concerns about the impact on competition and fears that community banks would leave the municipal finance market. Credit union representatives struggled to describe how they would manage and safeguard such large deposits were they to win the authority.
NYBA thanks its members who responded to last week’s grassroots action alert regarding the hearing. NYBA’s campaign generated more than 1000 letters to legislators, many of whom acknowledged having been contacted by their local bankers. Overall, the banking industry presented a strong case for turning back this credit union expansion, with lawmakers asking thoughtful questions about the economic impact of such a decision. The State Senate Banks Committee is set to consider legislation on Wednesday and NYBA will be launching another grassroots action alert. Please watch your emails for more developments.
For more information, please contact:
Michael P. Smith, President, NYBA, at (212) 297-1699
Clare M. Cusack, General Counsel, at (212) 297-1664
Megan Rowan McGovern, Deputy General Counsel & VP, Government Relations, at (212) 297-1669