Will NCUA’s Journey Be From Chartering a COOP Movement to a Regulatory Dead End?

What kind of financial regulator would be most effective to carry on the purpose of the credit union system stated in the FCU ACT? (see note on Congressional purpose at end)

Should the credit union system be overseen by a regulator of cooperatives or of financial institutions?

The arc of federal regulation from 1934 to today is simple. The federal regulator evolved from the role of chartering, promoting and supervising cooperatives to just another financial supervisor safeguarding an insurance fund.

The coop design is unique in American financial options. The users are the sole owners of the service. The intent was to create shared community resources not private wealth. The structure was to be perpetual with the common equity always “paid forward” to benefit future generations.

Moreover, financial soundness was underwritten by this shared purpose of borrowers and savers. Governance was democratic–each member-owners had one vote. No proxies.

The Impact of NCUSIF On Coop Regulation

The turning point in cooperative regulation was the 1970 passage of a federal deposit insurance (NCUSIF) option modeled after the FDIC and FSLIC. The banking funds were created in the early 1930’s in response to the “banking holiday” failures in the depression. The nascent state chartered credit union movement had no such system failures. Deposit insurance was not part of the FCU act passed in 1934. It wasn’t needed.

The need for the NCUSIF was much debated by credit unions in the lated 1960’s. CUNA opposed the option arguing such an institution would eventually dominate the system’s functioning. A new trade association, NAFCU, was formed to lobby for and pass this federal option for cooperatives.

The NCUSIF was not created because of system failures. Rather it was a recognition that cooperatives, while different in design, were just as safe as any for-profit banking option.

As NCUSIF insurance spread, so did federal regulation mimicking other banking regulations.

From Cooperative Partner to Financial Overseer

When implementing deregulation from 1981-1985, NCUA Chairman Callahan asserted credit unions were unique. The so-called level playing field arguments, he believed, would undermine the cooperative advantages of member-ownership.

Callahan believed regulations should promote cooperative purpose and collaborative actions. Both tenets were key tp the financial restructure of the NCUSIF and achieving 100% credit union participation in the unique CLF’s-coop system liquidity partnership.

But the bureaucratic pull of Washington prompted later NCUA leaders to emulate the example and practices of banking regulators. Safety and soundness, not member service, became the regulator’s mantra.

Both NCUA and credit unions sought Congressional hearing seats at the tables with the titans of America’s financial services.

Today NCUA has copied banking regulators with rules such as risk-based capital and, expanding market sources of capital. New charters are non-existent. Cooperative purpose is never mentioned in supervisory priorities.

NCUA oversight has fluctuated between laissez faire (let the free market decide) to embracing the administration’s political ideology from DEI to government downsizing.

The absence of any reference to coop design is that there is no protection for for member-owner rights or their collective savings. NCUA like the banking regulators has reduced their oversight to merely offering a $250,000 payout in the event of institutional failure.

This neglect of member-owners’ rights has resulted in boards staying in power perpetually. Owners are kept out of any governance or voting role. Bylaws are modified with NCUA approval to prevent member initiatives. Boards and CEO’s feel free to take a credit union’s business model and its billions in legacy assets in any direction they choose.

Transparency for cu leaders’ conduct is non-existent. Director fiduciary duties flouted. Accountability for outcomes occurs only after a financial crisis. Then the system’s leadership shortcomings are quickly swept under the rug via mergers.

When new CEO’s arrive from outside the coop system, often former for-profit financial professionals, they bring their prior experiences with them. They act like teenagers given a new high-powered formula 1 car. With board assent, they jump into the driver’s seat and try to see how fast they can make their new institution grow.

The NCUA’s Future

Today NCUA acts and sounds like the other banking regulators. Credit unions applaud the Trump adminisration policy of government tear down and relaxed o exam oversight. NCUA appears alongside the other financial overseers in Congressional hearings, states all is well, and makes no effort to describe how the tax exempt coop system is fulfilling any public duty.

The consequence is that credit unions no longer see their organization as part of an interdependent financial system. Institutional success is celebrated versus cooperative’s ability to create better financial solutions for those who have the least or know the least about personal finances.

Individual credit union priorities look more and more like capitalist business plans. They attempt to acquire, not support their peers, via merger takeovers. If that fails, just buy a bank.

With self-perpetuating board oversight, regulatory withdrawal, no transparency about transfers using tens of millions of member-owners’ capital, the cooperative system may lack the capacity for self-correction. Industry hegemony, not cooperative purpose, becomes the institution’s endgame.

How much longer will Congress or public policy think tanks not pose the existential questions: Why does America need a financial system that emulates its competitors, but with a tax exemption? Will NCUA become part of Treasury’s financial oversight, just like the OCC? Why have two federally managed deposit insurance funds that provide the same function?

“It Makes No Sense:” One Analyst’s Assessment

Yesterday’s post gave a brief history of federal regulatory evolution, It tracked the various federal governmental departments that shepard credit union’s evolution. And subsequent events under NCUA as an independent agency. This is that author, Ancin Coolley’s concern, about where the coop movement stands today.

When you read credit union regulatory history and go back to the arguments, it keeps bringing me to this point: the FDIC and other agencies did not want credit unions. And it calls to mind the question, why did they not want them?

They did not want them because credit unions were not treated the same way as other financial institutions. They were viewed as something that drifted into a social-services posture.

And honestly, the more I dig into the history and the legal history, the more it feels like I’m finding out Santa Claus isn’t real. The more I learn about the lack of standing for members in court, and the reality that there’s often no remedy for members against directors who effectively give away capital, the more disorienting it feels.

It’s like there’s the reality I want to believe in, and then there’s the legal reality of what a credit union actually does.

And what I can’t even begin to reconcile conceptually is this: credit unions want to maintain their tax exemption while also purchasing banks. In good conscience, I can’t even argue against someone who says, “How are you going to maintain your tax exemption if you’re buying a bank, when you were originally given a tax exemption for not being a bank?”

It makes absolutely no sense.

Editor’s Note on Cooperative Purpose:

Congress added the following language to the Federal Credit Union Act on August 7, 1998.

The text was included as part of the Congressional Findings in Section 2 of Public Law 105–219, also known as the Credit Union Membership Access Act.

This specific language was crafted to affirm the Mission and reassert that credit unions serve people of “modest means.”

The Congress finds the following:

The American Credit Union movement began as a cooperative effort to serve the productive and provident credit needs of individuals of modest means.
Credit unions continue to fulfill this public purpose, and current members and membership groups should not face divestiture from the financial services institution of their choice as result of recent court action.
To promote thrift and credit extension, a meaningful affinity and bond among members, manifested by a commonality of routine interaction, shared and related work experiences, interests, or activities, or of an otherwise well understood sense of cohesion or identity is essential to the fulfillment of the public mission of credit unions.
Credit unions, unlike many other participants in the financial services market, are exempt from Federal and most state taxes, because they are member-owned, democratically operated, not-for-profit organizations generally managed by volunteer boards of directors and because they have the specified mission of meeting the credit and savings needs of consumers, especially persons of modest means.
Improved credit union safety and soundness provisions will enhance the public benefit that citizens receive from these cooperative financial services institutions.

February 9, 2026February 10, 2026

Can Credit Unions Buy Their Way to Success?.

For the first 75 years of credit union history, member, share and asset growth was from internal, “organic “ business efforts versus external acquisitions.

Some of the factors requiring this approach were regulation, field of membership limits, the absence of external capital or liquidity, and the cooperative design’s “local” advantage.

After deregulation of financial services became government policy in the 1980’s, many of these constraints were modified. Growth options expanded. FOM regulations were broadened. New membership strategies such as indirect lending were introduced. Credit union leaders expanded their market ambitions.

Purchasing New Accounts

Today many credit union strategies involve both organic and external acquisition growth tactics.

This market bidding for new members is illustrated by financial institutions’ multiple offers for new checking accounts. Here are some recent cash bounties sent to me:

From an airline credit card issuer:

As a valued Chase customer we’re thanking you with an up to $900 offer. Open a new Chase total Checking account and the new Chase Savings account with qualifying business activities.

One of my credit unions emailed this offer:

Dear Charles,

You can still earn up to $100 when you open a new Patelco Checking and Money Market account. Here’s how.

USAA’s post card appeal had this headline; $400 Cash Bonus. The offer: When you apply for and open your first USAA Classic Checking account and receive a qualifying direct deposit. Offer is nontransferable.

A new local bank, Atlantic Union, promised a $400 welcome bonus in three easy steps.

Open a checking account.
Set up direct deposit.
Collect you $400 bonus.

Not to be outdone, PenFed offers up to $300 for opening a new checking account with a qualified deposit. To receive the full $300 requires an initial $20,000 deposit. The average daily balance must remain above this amount for five months to receive the $300.

Can Credit Unions Win These Bidding Battles?

Indirect auto loans illustrate the ultimate challenge of external asset purchases. Can these new customers be converted to loyal members. Or is the transacton a one and done event?

Before deregulation the credit union option was itself compelling. Word of mouth was the most common marketing effort. Credit union membership was thought to be a valuable benefit.

One proof of this belief is the many times members moved away from a job or their community, but chose to retain their credit union affiliation-just in case I need it.

In what some CEO’s view as a commoditized financial services arena, the quickest way to grow is to go buy it. These efforts include third party loan originations, purchasing individual participations, acquiring whole banks and the ever present offers to merge facilitated by golden parachutes for the selling CEO.

Is offering a better price sustainable?

Will these “bonus” pricing strategies result in long term loyalty?

What is the Coop Competitive Advantage?

Buying growth seems easy at first. The costs and immediate increases in size are seen. The longer term question of whether these relationships last, is down the road.

The tactics of purchasing initial market success raises important questions:

Does cooperative design, other than the federal tax exemption, give the credit unions a competitive advantage in these price/bonus competitions?
Does acquisition of new accounts via third parties result in new member relationships, or a temporary lift?
If growth via acquisition becomes an important strategic effort, does a cooperative’s internal capability for organic market efforts atrophy?

Buying growth is not a unique market capability. It is very visible and easy. Just call up a broker or other third party originator. The real work of relationship building just begins with the booking.

Purchasing growth is constrained by internal resources and market competition. Is attracting new members with a better price the best way to present the cooperative value advantage?

Learning from the Past

The capabilities and reputation that created a $2.3 trillion ciiperative financial system today were built on a foundation of multiple factors. These included convenience, personal service, local familiarity and a fair price. All wrapped in values centered on collective community care.

The challenge of creating real organizational value is ever present. The answers are not simple and often unique to a credit union’s situation and leadership skills.

The response is not to go back to a prior era or model. Rather it is a simple lesson from generations of coop success. If an organization wants to be a credit union, then it must decide to be one. Not perfect, but at least good. America has plenty of banks.

P.S. Here is a case study published by CUDaily of a credit union expansion effort based on credit union advanages: Why a California Credit Union Intro’d a New Digital Brand in Georgia.

February 5, 2026February 5, 2026

What Are Credit Union Schools Teaching?

One of the important collaborative efforts is the system of credit union professional courses. These multi-year commitments are preparing junior staff members for leadership roles in their careers.

I received the following note from a person attending one of the oldest and largest of these programs:

I am in my third and final year at Western Credit Union Management school. In working on my final project, I came across a past high honors project that I wanted to share with you.

It details one larger credit union’s growth strategy through mergers and acquisitions. What is particularly interesting is how they view the Small Credit Union category, which they define as $500 million and less.

“A very desirable new market or a significant new strategic capability would need to be evident for our cedit union to consider a merger with a small credit union. Otherwise, the operational disruption would not be worth it.”

She attached the full project of almost 200 pages. It is very professionally done. Well organized, lots of data, tables and clear presentation strucure. The student’s own credit union is analyzed with a SWOT framework. Various consultant views are offered and footnoted.

Mergers and acquisitions are just one of five goals to try to restart the credit union’s slowing member growth.

I did not thoroughly read the entire thesis. My question would be who is providing feedback on these major academic efforts?

For the work is filled with data and other documentation, current in its references, and logical in the recommendations.

I did not study all the points. It is written from an institutional perspective. I did not see any reference to two areas: credit union system’s future as a unique alternative for members, and what parts of the consumer market are in most in need of cooperative solutions. Growth was the goal.

The thesis is a well written document that should be used as a starting point, not a final plan of what this credit union aspires to be. Who are the readers and evaluators for these academic exercises?

February 4, 2026February 4, 2026

When Music Transforms Words

The folk singer Jesse Welles and retired credit union CEO Jim Blaine are separated by two generations of lived experience. Yet they share a vision and common mission for the country.

Each person has their own professional “lane” for implementing their commitment. Side by side they illuminate each other’s core values.

Most credit union people of a certain era know about Jim Blaine’s career at SECU (NC). Over five decades he built the country’s second largest credit union by not following conventional industry practice.

His two guiding principles to staff were simple: Do the right thing and Bring us your Momma. Folksy, yet profound.

No risk-based pricing–a member either qualified or not for the loan. No indirect lending allowing a third party to set the rate. No frills credit cards. Focus on real estate as the surest means to enhance member long term well-being.

He created a Warren Buffet like organization with centralized funding but local decision making and implementation, SECU built a statewide network of ATM’s and over 200 branches. He chartered a unique member-funded foundation supporting education, health and other community needs throughout his home market, the Tar Heel state.

He was outspoken about his approach to cooperative purpose, often challenging peers’ priorities.

“A prophet is not without honor, except in his hometown” is a biblical phrase that summarizes Jim Blaine’s most recent efforts.

For the past four years he has spoken his mind about the direction SECU’s board and senior management have taken. His blog, SECU just Asking is plain spoken, factual, and sometimes personal when publicly challenging the credit union’s change of philosophy.

Over five decades Jim built one of the most successful cooperative financial charters in America by following one simple rule: “What’s good for the least of us, is good for all of us.” A phrase with multiple meanings.

The purpose of the tax exempt cooperative system is to serve a vital segment of America’s consumers. He described that group as: Those who have the least or know he least pay the most for financial services in America today.”

Many peers misunderstood this approach, believing his business model was archaic, lacking innovation and missing the most important market, the A credits and well-to-do.

Enter Jesse Welles

I was listening to recent protest songs from community sings in Minneapolis, now under federal armed siege. My algorithm offered a Woody Guthrie, Pete Seeger-style activist folk singer.

Born in 1992 in Arkansas, Jesse Welles has, over the last ten years, written hundreds of single ballads about life, politics and those left out of America’s promise.

One commentator describes his voice as sounding like burnt toast. To which he replied, but you can still eat it.

One ballad that caught my ear was called The Poor. The chorus has these ironical lines to support the common view that the poor just need to work a little harder: “It ain’t the banks / And it ain’t the taxes / It ain’t the payday loans and high-rent homes / And predatory fees and practices”.

(https://www.youtube.com/watch?v=I6vjaimSK4E)

Jim Blaine is the counter example to Jesse’s satirical critique of those who blame the poor for being poor.

A Common Mission

Both men are outspoken, but grounded in the belief that change can happen. They are unconventional in their approach to their professions so are unlikely to be honored by the establishment.

Both believe in protecting the vulnerable, standing up for justice and caring for “the least of these” in our communities. For them economic justice is moral justice. We cannot remain silent when individuals and families are preyed upon by a system that celebrates profit as its highest priority.

These two voices illuminate a shared vision. Together they challenge us to live into our better selves.

January 21, 2026January 21, 2026

Living in an Era of Golden Calves

The golden calf in biblical stories is a symbol of idolatry. In these tellings, the statue is worshipped by a people or nation that has forgotten the values they held together. These idols include the temptations of earthly riches, political domination and worship of false gods.

Currently, Trump literally holds court with the public and press in a gilded Presidential office.

The credit union system also displays the appeal of glitter. Every week there is a new PR release of a credit union climbing the never ending ladder of state or national asset rankings. These steps upward are not from internal growth, but from a just completed external acquisition.

Concerns Being Raised

Credit unions’ exemption from state and federal income tax implies an obligation of public duty. The cooperative option was not intended as just another financial choice. But instead, an alternative to the for-profit system driven by ever greater market share and superior financial returns.

Here is an AI generated Edward Filene critique of credit unions’ tendency to adopt banking practices. Created by a concerned coop CEO. (link)

(https://www.youtube.com/watch?v=3lBPV3tx_WM&t=21s)

In this time of misplaced or lost public purpose, some feel called to be truth tellers. They seek to transform the priorities of wayward coop activities. Some of these credit union believers are member-owners. They call out the abandonment of member value being replaced by institutional glory. And the frenzied search for more golden calf acquisitions.

They speak the truth that credit unions were formed to provide consumers a financial home that would avoid the excesses of the for-profit sector. Today, some coop leaders believe that to beat the competition, a credit union must become the competition.

With coops, the owner-customer design can be an unmatchable competitive advantage. That is, until members are treated like customers whose relationships are routinely bought from or sold to third parties.

Truth Renews Hope

The American cultural anthropologist Margaret Mead said: “Never doubt that a small group of thoughtful, committed citizens can change the world; indeed, it’s the only thing that ever has.”

She emphasized that significant cultural and institutional shifts always begin with a few individuals who act as catalysts, demonstrating new behaviors and inspiring others.

Coop strength is an example of Mead’s observation. A credit union’s viability is from roots planted by a small committed group and nurtured with generations of member loyalty.

Some of these member-owner voices are being raised to challenge their institution’s monopoly of corporate power, not subject to their governance.

They are raising alarms in their local press and sometimes in national media. Some concerned CEO’s are no longer willing to follow their industry’s call to be still about their objections with their predatory peers.

Standing up for Democracy

In multiple institutional pillars today (media, universities, military, business) democratic norms are under attack. Voices are reminding credit unions of their purpose– to offer each member a financial home where their “daily bread” is the priority versus an insatiable drive for growth.

Even in the uncertainty of misdirected events these individuals are joining hands and linking arms to return the coop model to its counter-cultural economic responsibility.

Credit unions will once again be recognized as a safe place where people, even when on the edge, can find hope.

This cooperative public spirit has transformed lives and the well-being of millions. It is an option that has attracted over one hundred million Americans as member owners and billions of their savings dollars.

But will this effort to rekindle credit union purpose succeed?

Martin Luther King stated the challenge this way: Truth when crushed to earth will rise again. This is the credit union’s public promise, even as some bow their knee to the altars of gold.

January 5, 2026January 5, 2026

Balancing the Old With the New in 2026

When implementing NCUA’s practice of turning around problem credit unions versus liquidations or paying to merge, the key success factor was finding experienced capable turnaround managers. One name was frequently mentioned as an example by NCUA Regional Directors (RD) in this talent quest. Only after leaving NCUA did I meet him.

Jeff Farver was the CEO of San Antonio Federal Credit Union (SACU), now Credit Human, for almost 22 years–July 1990 to retirement January 2012.

In early 1990 Farver was asked by NCUA RD John Ruffin to take over NCUA’s largest problem conserved credit union. By 1995 this insolvent $650 million coop had achieved a 6% net worth.

Becoming a Problem Solver

SACU was not Jeff’s first rodeo. In the 1970’s, he had joined a small Florida bank as comptroller just as interest rate turmoil upended traditional assumptions about investment management. At Eglin FCU in Florida, he resolved a deeply flawed investment strategy as investment manager.

Based on this success he was hired as CEO of Chattanooga TVA FCU. Upon arrival, total assets were earning 8% and the cost of funds was 8.25%. The investment portfolio in 1981 was $5 million underwater due to Fed Chair Volcker’s rapid double digit increase in short term interest rates.

His success in these three previous problem situations caused NCUA’s new Region 5 RD John Ruffin to again reach out to takeover San Antonio Credit Union, the industry’s largest problem case. The credit union was $25 million insolvent with troubled business loans, fixed rate real estate loans underwater and no proactive recovery strategy. He took 90 days to assess the situation and then negotiated a partnership with NCUA to inject a NCUSIF capital note, incentive targets and forbearance for time to implement product and business changes to restore solvency. By yearend 1995 he had achieved his 6% net worth objective set in his workout goals with NCUA.

Recently Jeff shared thoughts from a decade of post-retirement mentoring college business students.

I describe his advice from five decades as balancing the tried and true with the new. A timely quest at the beginning of the year.

A Turnaround CEO’s Learned Wisdom

The reason I bring the balanced scorecard concept is that I do believe in balance! If an organization and its leadership “over-plays” diversification of its customer base and takes away resources and “pricing values” from its existing customers, it is putting at risk the customer base that brought its current success.

Further, the question must be answered how diversification impacts existing customers in the short term and more importantly in the long run. Leadership must articulate the pros and cons of growth for growth’s sake.

In 2000, SACU’s indirect auto lending was 60% of our earning assets and 70% of gross income. I recognized that gas price hikes or recessions could adversely impact our delinquencies, charge offs and financial workout. Also real estate lending was a commoditized market with narrow interest spreads and Interest rate risks causing surges in demand or declines of loan volume.

Entering a New Market

By luck I interacted with several manufactured home lenders in trouble financially. With GNMA’s help, SACU took over the servicing of their GNMA loans, hired their staff and entered this new line of lending.

Months later Jamie Dimon in the Bank One merger chose not to continue the Manufactured Home lending business. I went to Seattle and convinced 34 Western region mobile home lenders to become credit union employees. They generated $200 million in new mobile home loans the next year.

These new business lines generated improved Interest rate spreads, allowing us to pay our existing members better savings & CD interest rates. Moreover, our manufactured home loans averaged 200 basis points less than bank or other lenders’ interest rates.

When I retired in 2011, SACU had $1 billion in indirect auto loans and $1 billion in manufactured home loans. SACU’s diversification was a win for our member savers and our new MH Loan borrowers. It is the cooperative model at its best.

Don’t Forget the Core

The key issue still today is how do mergers, expanded market reach, bank or third party loan acquisitions, and new services provide value to existing members whose loyalty created the basis for further expansion? Without balance, credit unions could lose the relationship advantage that is the basis for their continued success.

December 15, 2025December 16, 2025

Live Video of the Largest Credt Union Conference

In my December 9th post I included a preview from NCUA’s Video Network of the largest credit union conference ever held to that point in time.

That short 20 minute overview gave NCUA staff’s instructions for the meeting plus an introduction to the content for examiners and credit union attendees.

After the event was over, video highlights were edited and shared in NCUA’s Edition 18: The December 1984 National Examiners Conference in Las Vegas.

The 55 minute of outtakes focuses on three topics: common bond, the role of the regulator and the future of credit unions. Speakers include state regulators, CU CEOs, NCUA staff and other federal supervisors such as Richard Breeden, Martha Seeger, Ricard Pratt. NCUA Chair Ed Callahan provides opening and closing remarks, plus comments on what makes credit union’s truly unique.

The conference is also covered in depth in NCUA’s 1984 Annual Report. However the video captures the events live including reactions from among the 3,000 attendees.

Why This Event Is Relevant Today

Although this special gathering concluded 41 years ago, the event still speaks to credit unions today in that:

* It demonstrates the multiple participants within the movement working in shared purpose.

* Speakers showcase leaders of the coop system– regulators, credit union professionals and experts in financial services.

* Critical issues in this era overlap those today: mergers, taxation, competition, innovation and the fundamental advantage of cooperative design.

History Matters

From the truism “there is nothing new under the sun, to history never repeats, but does rhyme” there are multiple ways to learn from past events.

This video shows cooperative leaders in their most articulate and thoughtful approaches to the future. NCUA’s conference agenda of over 300 sessions of breakouts and general panels captured the movement’s advantage of sharing expertise and experience for everyone’s benefit.

Comments were sometimes controversial and often in disagreement, for example the need for a common bond. Or, “Trust in a financial institution is like virginity; once you lose it, it’s hard to get back.”

The conference was also a celebration. Just two months earlier the NCUA board approved regulations implementing a completly different approach to the NCUSIF’s financial structure. Instead of copying the other federal insuers annual premium approach, the new design used cooperative experience to create a new m;odel built centered upon an “evergreen” 1% deposit.

Most critically it showed how a credit union regulator and the movement can work together for enhancing the future for tens of million member-owners.

What Attendees Remember Today

Clifford Rosenthal: A personal memory of the big conference in Las Vegas. It was a big deal for me; I was new to my role serving as head of the National Federation. I still have the little lucite piece that was given to attendees.

Paul Horgan: (credit union CEO) Two recollections: NCUA and the Vegas meeting.

The meeting was innovation at its best. Communication was the key feature. Goodness, that was 41 years ago.

On Ed Callahan: Don’t remember the exact month and year but recall having the privilege of driving Ed from the Brainerd, MN airport to the league meeting…on the long drive I criticized the capitalization plan, he really listen then replied “Okay tell me your better idea.”

I guess today’s takeaway is “enjoy your friends before it’s too late.”

Mark Wolff (former NCUA employee):

Thank you for your post about the National Examiners Conference and for sharing the promotional video. Wow, watching it (and me in it!) was like going back in a time machine!

Being in the NCUA public affairs office at the time, I remember the sustained promotional effort to generate awareness and attendance. Along with the video I seem to recall regularly highlighting the conference in our newsletters and press releases that NCUA sent to credit unions at the time and in board members’ speeches to CU groups.

During the conference I remember being struck by how many people had attended and how crowded the hallways were between breakout sessions. At the time I’d never seen anything like it. We all had a nice feeling of accomplishment afterward.

The CODA

Three months later at the 1985 CUNA GAC conference, Chairman Callahan announced that he, Bucky and I would leave the agency. His term as Chair still had two and one half years remaining. His explanation was, “We’ve done what we came here to accomplish.”

He said his future goal was to work with credit unions to develop the opportunities presented by deregulation. One of those outcomes was the founding of Callahan & Associates.

December 10, 2025December 10, 2025

‘Tis the Season for Sharing Success with Members

To demonstrate the cooperative difference, some credit unions plan sending bonus dividend and loan interest refunds to members at year end.

Yesterday I read in one CEO’s staff update that they were doing well enough to have accrued a minimum of $10 million in special distributions for savers and borrowers.

Here is an example of an announcment in which Robbins Financial CU is sending members $20 million. The special rebate program is to reward members’ loyalty and to demonstrate the credit union’s financial strength.

However credit unions are not the only financial firms which provide “members” with refunds, rebates or special dividends. The following are excerpts from a large mutual, insurance and investment firm which competes directly with credit unions.

USAA Members Benefit from ~$3.7 Billion in Financial Rewards in 2025

Record Amount Underscores Association’s Commitment to Military Families

San Antonio, TX – USAA members are receiving approximately $3.7 billion in financial rewards in 2025 — the largest amount returned to members in USAA’s 103-year history. . .

The announcement follows USAA’s initiative to provide its members with nearly $450 million in zero-interest loans, payment extensions and fee waivers during the recent government shutdown.

In November, the Association also launched Honor Through Action, a five-year, $500 million initiative to support military family resiliency by bringing together public, private, and nonprofit partners to drive systemic change around three key pillars: meaningful careers, financial security, and overall well-being.

“We are committed to putting our members at the center of all we do and every decision we make,” said Juan C. Andrade, President and CEO of USAA. “Sharing our financial results with our members reflects our responsibility to deliver strong value and exceptional service for the military community. We are taking action every day to help keep costs down and protect the long-term value of membership. . .”

This record amount in financial rewards is possible because of USAA’s financial discipline, . .It is also a result of proactive steps USAA and members have taken to prevent losses.

“Ensuring our members benefit from our financial strength is critical.” Andrade added. “We will continue to push for reforms that address the broader factors increasing insurance costs for consumers.”. . .

USAA’s Impact in One State

The person who sent me thlis information added a calculation for his home state of North Carolina:

Why this matters for North Carolina:

Members in North Carolina will receive an average of $200, depending on their policies and location, as a bill credit or money back based on the member’s preference.

Good ideas do not take long to replicate. Especially when customers are treated as members.

Do credit unions really need to retain an average of over 11.0% retained earnings when the well-capitalized goal is 7%?

December 9, 2025December 9, 2025

December 9, 1984 – A Grand Credit Union Opening Day & An Early Departure

The largest credit union conference ever held to this point in time began gathering on Sunday, December 9, 1984 at the MGM Grand Hotel in Las Vegas.

One of the most amazing aspects was that the entire effort was organized and led by NCUA. It was an event unique then, and still today, in credit unon history.

The conference had two phases. In the first two and one half days over 800 state and federal examiners and regulators held meetings to share their learning and expertise. On Wednesday afernoon they were joined by over 1,500 CEO’s/seniorexecutives, board members and leaders of multiple league and trade organizations.

An NCUA Led Effort

Two months prior in October, NCUA released a Video Network Edition XI for state and federal examiners to describe conference logistics: timing, travel arrangments, financial reimbusements and per diem. And most importantly, a preview of the speakers and conference agenda.

The National Examiners Conference preparation video is 20 minutes and can be viewed here or in the link below. The eight speakers are all NCUA DC staff members responsible for specific areas of the conference.

The details may seem pedestrian by today’s conference attendee. The room rates were only $35 per night for single or double. These critical instructions show NCUA staff at its hard working best.

The Agency’s Washington team organized a national industry wide meeting led by only existing personnel. At the time the Agency employed approximately 600 people. This special event was in addition to the entire staff’s day jobs.

According to the NCUA’ 1984 Annual Report there were 10,547 active federal charthers and 4,657 insured state charters, plus another 1,500 whose share insurance was from a state authorized cooperative fund. Moreover, all FCU’s were being examined annually, a process implemented in 1982.

The Agenda

Following six short briefs on conference logistics, at minute 14.21 a presentation of the “most important part of any conference” begins. Joan Pinkerton, NCUA’s Public Information Officer, gives an overview of the conference speakers and over 50 breakout sessions.

Topics include: Is the Regulator Obsolete?, How the Early Warning System (EWS) Rating is Assigned, Recent Industry Scams et. al. At minute 17 Mark Wolff describes real case studies that will be discussed in joint examiner-attendee sessions. The case details of up to 25 pages will be available to read in advance.

What Happened

The conference succeeded beyond all expectations. It was both a learning and bonding event. Next Monday I will publish Edition 18 of the NCUA’s Video Network, 55 minutes of live excerpts of the conference highlights.

Even today, some 41 years later, the event is still remembered as a special moment enabled by the collaborative character of the credit union system.

If you would like to share your memory, please send a short post to chipfilson@gmail.com. I will include these along with the video and photos of the conference.

(https://youtu.be/Tw_JKnheoSk)

Another December 9, 1984 Event

On Saturday October 8 NCUA colleagues Bucky Sebastian and Mary Beth Doyle stopped by the house to drive me to Dulles where we would fly to Vegas for the conference.

Mary Ann and I had been married for 17 years. Our first date was my senior year in college at the Harvard-Princeton football game. I had been expecting to go with her younger sister whose flight from Midland, MI was canceled due to snow Mary Ann took her place.

We married 18 months later in a service at Merton College Chapel, Oxford, where I was a student and she worked in London for Dow Chemical’s UK office.

We traveled the world together, first courtesy of Uncle Sam who said I owed him some time. Our first daughter, Lara, was born in Athens, GA while I was at Supply Corps School. Our second, Alix, was born in Yokosuka, Japan where I served as Supply Officer on the USS Windham Cty (LST-1170) and later at the Supply Depot on shore duty.

After four plus years in the Navy, in December 1973 I joined the International Division of the First National Bank of Chicago expecting a two year rotational training period. Six months later our family was in Sydney, Australia. I was in the bank’s rep office and assisted with their wholly-owned finance company FCAL. It was a time of critical economic turmoil, short term rates were over 20%. They wanted help working through the crisis in FCAL’s loan portfolio.

After three years, we returned to Chicago. I left the bank to work with Bucky Sebastian and Ed Callahan in the Illinois Department of Financial Institutions (DFI) where I was credit union supervisor. Five years later we moved to Bethesda as the three of us joined NCUA.

In these 17 years Mary Ann was critical to everything that life brings to a family. She not only had the primary care roles with our two girls, but also worked a full time job where possible.

Her talents for maintaining home life while I was traveling, expanding her interests in photography, design and working with her hands in the kitchen or the sewing room are habits both girls adopted. She was disciplined, but in a very soft way, always sensitive to others’ needs.

I am grateful our two children inherited all the good she gave them which they express every day.

She had an adventurous streak as well. Once we pulled into Hong Kong harbor on R&R. Mary Ann and several other wives flew from Japan to see us. Our LST anchored in the harbor. The city was still under British rule. The Navy purchasing office would first send out local supply boats to refill our fresh water tanks and order fresh food supplies.

As I stood on the deck waiting to give our purchase order to the local vendor, I saw the small harbor craft had an extra passenger. Mary Ann didn’t wait for us to come ashore via the harbor’s water taxis. She came out, on her own, in the middle of the harbor to welcome the whole ship. It was just plain joy as she came on deck. The Captain was a little uneasy with this protocol breach, but never said a thing.

In the picture below, Mary Ann with Lara and Alix are on on the beach in Hayama, Japan. Fuji is faint in the distance. It is the fall of 1971.

Mary Ann’s mother had flown in to help while I spent the week at NCUA’s Examiner Conference. Early Sunday morning I got a call from her mother that Mary Ann had gone to the hospital that night and died. Her five year fight with breast cancer was over. I flew home that morning. Our 17 year journey together was over.

Now go back to the 14th minute of the video above and see Joan Pinkerton. For in 1987 we were married. She knew Mary Ann and had even babysat our girls when we traveled together. Life is full of possibilities even when some hopes end. Joy can still be found.

December 3, 2025December 3, 2025

A Merger Explained Simply

Yesterday I posted a 3,000 word analysis of the proposed merger of Spirit Financial in Levittown, PA with Credit Union 1 headquartered in Lombard, IL.

Included in the analysis are the reactions of two Spirit members from NCUA’s website:

Member Brian Stuart comment: I am voting against the proposed merger of Spirit Financial Credit Union with Credit Union 1. Credit Union 1 is based in Lombard, Illinois. All of its branches are in Illinois. There is no advantage to the Spirit Credit Union member to merge with Credit Union 1. Merging with Credit Union 1 would take away the local Bucks County focus of Spirit Financial Credit Union, which should be its mission. . .

Member Joann Glasson: As a long-time member of Spirit Financial Credit Union, I am sad to see this merger occur when the CD rates are so much lower at Credit Union 1 and the loan rates are so much higher at Credit Union 1.

We are retirees with large deposits at Spirit that we will be forced to move if the merger is approved. This merger is not a service to the members of Spirit Financial Credit Union

Due to the article’s length, I sent the following summary to the press:

$9 MILLION IN LEVITTOWN COMMUNITY WEALTH TO BE GIVEN AWAY – CREDIT UNION CEO WOULD RECEIVE $4.4 MILLION

Spirit Financial Credit Union, a strong and profitable 72-year-old community institution, is being absorbed by Credit Union 1 of Illinois (pending a member vote) and in the process, Levittown’s families will lose nearly $9 million in community-built capital, while Spirit’s CEO personally will walk away with more than $4.4 million in payouts and benefits. Member balloting on this proposal ends Dec. 22.

Spirit Financial isn’t struggling — it is thriving:

highly capitalized,
financially stable,
outperforming peers,
and the only locally headquartered depository institution serving Levittown.

Yet in a quiet, opaque merger, every dollar of the members’ accumulated equity of approximately $9 million will be transferred to an out-of-state institution for free:

No payouts to Spirit Financial member-owners
No equity retention
No bonus dividend
No local control
No sole ownership

Levittown’s families built this wealth, and now it’s about to go away.

Meanwhile, the Spirit CEO who championed the merger receives:

A massive cash bonus at closing
A guaranteed five-year employment contract
Incentive packages to solicit more mergers
A fully vested multimillion-dollar retirement package, all totaling more than $4.4 million in personal enrichment.

Community wealth will be removed, assimilated, and relocated, while ordinary member-owners will be left with nothing.

Control of Levittown’s financial legacy will shift to a board in Illinois that is unreachable, unelected, and governed by mechanisms that dramatically limit member democracy.

This is not an isolated incident. Credit Union 1 has initiated over 20 such mergers in just 3½ years, importing hundreds of millions in community assets and capital and using merger accounting to mask weak operating earnings while expanding its asset base by taking over independent, strong local credit unions.

This development raises urgent public questions:

How can a member-owned institution be sold without any benefit to its owners?
Should executives be allowed to personally profit from the liquidation of community capital?
Where is regulatory oversight when cooperative ownership is silently dissolved?
Which Pennsylvania credit union will be targeted next?

If this were a stock corporation or public company, shareholders would be compensated, and regulators would not tolerate uncompensated transfer of equity. But cooperative members will receive no payout, no recourse, and diminished legal standing.