WASHINGTON — CUNA challenged the idea that credit unions need to become mutual banks in a letter to the editor in American Banker.

In the Oct. 20 letter, CUNA CEO Dan Mica takes issue with an opinion piece from charter change advocate Alan Theriault that ran in the publication's Oct. 13 issue. "Interestingly, American Banker this week included interviews with the incoming chairs of the American Bankers Association and America's Community Bankers," Mica wrote. "Both put regulatory relief high on their agendas. Does Mr. Theriault believe their mutual savings and commercial bank members should flee their charters as well?" Mica argued that regulatory pressures actually increase on a credit union that changes its charter to become a bank particularly one that subsequently issues stock and therefore has a body of stockholders to deal with that it didn't have before. "With average capital equal to over 11% of assets and no outside stockholders demanding double-digit return on equity, credit unions can afford to focus on members with better rates, lower fees, and exceptional service," Mica wrote. "Mr. Theriault fails to grasp this concept, because he looks at credit unions through the eyes of a for-profit businessman. In his world, low or declining earnings are anathema," he added.

Mica also defended the NCUA's most recent proposed regulations on the charter change converting process, stating that the proposed rules are not a "roadblock" as Theriault charged, but an attempt to make sure credit union members have the information that they need to make a decision about charter change. "This is sound public policy," Mica argued, "for credit unions as financial cooperatives owned by their members."