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Bay State Bankers Brawl Over LICU Designations

The Massachusetts banking lobby takes aim at legislative proposals that would allow credit unions to accept public fund deposits.

By Peter Strozniak | Updated on May 18, 2016

A Bay State brawl erupted Monday between bankers and credit unions after a Massachusetts Bankers Association report claimed cooperatives are using the low-income designation to exempt them from many federal regulations, including limits on business lending and membership eligibility. `       

 “The most disturbing result is the fact that the largest credit unions are expanding market share unabated and unchecked at the expense of consumers, taxpaying community banks and even smaller credit unions,” said James Lively, president/CEO, Bridgewater Savings Bank and chair of the Massachusetts Bankers Association. “The growth and concentration in this industry is not only largely without benefit to consumers, the corporate tax subsidy gives the credit unions power to expand without any requirement to serve low- and moderate-income communities.” Cooperative Credit Union Association President/CEO Paul Gentile responded to the bankers association study in an interview with the Massachusetts State House News Service and other local news outlets, according to the Cooperative Association’s newsletter.

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Peter Strozniak

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