Military groups urge no systemic-risk fees for CUs

Nov. 10, 2009 – Military groups opposed to seeing credit unions assessed monies by FDIC for a systemic risk fund for the wind-down of large financial firms are making their views known on Capitol Hill.

On Monday, the National Military Family Association urged House Financial Services Chairman Barney Frank, D-Mass., and Ranking Member Spencer Bachus, R-Ala., to exclude credit unions from the systemic risk legislation currently in mark-up.

They are concerned that two of the three top credit unions that stand to be affected by the current bill are military credit unions, whose members would “unfairly [bear] the brunt” of the proposed fund. “Military credit unions and their members should not be penalized for poor financial management of other financial institutions,” wrote Mary Scott, the group’s chair.

The Military Officers Association of America offered a similar sentiment in a letter last week to the committee leaders. “I urge you to ensure the final legislation does not include an assessment on these not-for-profit institutions that are critical to the personal finances of our troops and their families,” wrote MOAA President Norbert Ryan.

“While reforms certainly are needed to avoid future collapses,” he continued, “MOAA believes strongly that military credit unions and their members that behaved responsibly should not be penalized for the management failings of other institutions.”

NAFCU has urged lawmakers to exclude credit unions from any systemic risk assessments made by FDIC under the bill. The committee resumes work on the measure next Tuesday.