Pub. 14 2019-2020 Issue 2

NEBRASKA BANKERS ASSOCIATION 11 crucial step toward drawing more oversight of the industry. More people now are ques- tioning whether credit unions, which enjoy a generous federal tax exemption, are earning this benefit. Even major media outlets like The Wall Street Journal, The New York Times and National Public Radio have turned a critical eye to credit union practices—run- ning stories on the lax enforce- ment of meaningful membership restrictions and an expose of the industry’s taxi medallion loans, which imposed predatory terms on thousands of taxi drivers and drove some credit unions out of business. The most recent criticism comes from a respected inde- pendent research firm Federal Financial Analytics, run by vet- eran bank ing policy analyst Karen Shaw Petrou who has a strong interest in matters of economic inclusion. The ABA commissioned the study but had no editorial control over Federal Financial Analytics’ research and conclusions. Petrou’s study assessed not only the extent to which credit unions meet their mission, but also how their federal regulator judges and enforces it. The paper found, among other things, that credit union members are dispro- portionately from middle- and upper-income households, that the National Credit Union Adminis- tration (NCUA) maintains no data on credit unions’ effectiveness at More people now are questioning whether credit unions, which enjoy a generous federal tax exemption, are earning this benefit. Reframing — continued on page 13