Contending that for-profit banks have no business getting free rent on military bases, three major credit union trade groups are asking leaders of the House Armed Services Committee to continue to give credit unions that benefit, while rejecting it for banks.
“Keep in mind, defense credit unions are owned by their members – the men and women of the military – while banks are owned by shareholders who are seeking a profit,” the Credit Union National Association, the National Association of Federally-Insured Credit Unions and the Defense Credit Union Council wrote to House committee leaders Thursday.
In what has become an annual fight, the Senate Armed Services Committee this week approved its version of the defense authorization bill, and as in the past, it contained a provision that would require equal treatment for banks and credit unions on military bases. Banking groups have been seeking that benefit for many years.
The House Armed Services Committee’s subcommittees are scheduled to begin their consideration of the defense authorization bill on June 22.
In a bluntly worded letter to the House panel, CUNA, NAFTA and DCUC said that unlike other financial institutions, credit unions put their members first.
“It is no secret, being member-owned and not-for-profit is how defense credit unions keep interest rates low and responsive to member needs (e.g., deployment), which improves the financial readiness of our military,” they wrote. “Other financial institutions simply cannot match the credit union difference.
Banking groups, such as the Association of Military Banks of America, argue that they simply are seeking parity with credit unions. They say that banks have left military bases because of high costs—depriving servicemembers of a variety of financial services.
The credit union groups said that banks already have the right to apply for rent benefits if they can demonstrate how they will serve people on the base, but they have not exercised that power. “Instead, they have opted to end-run [the Department of Defense] and go to Congress to get a handout under the guise that too many banks have had to leave military bases due to the cost of leases making military banking less profitable,” the credit union groups wrote.